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South Korea’s five largest <a href="https://xpertsstudio.com/uk-reveals-240-crypto-millionaires-in-first-official-tax-report/” title=”UK Reveals 240 Crypto Millionaires in First Official Tax Report”>cryptocurrency exchanges have listed more than 1,200 altcoins since 2022 and delisted 430 of them, according to data submitted to a lawmaker. Thirty-eight coins were dropped less than a year after listing, fueling criticism of lax screening by the exchanges and losses borne by investors.
The five won-based exchanges — Upbit, Bithumb, Coinone, Korbit and Gopax — listed a combined 1,236 new altcoins from 2022 through the end of July, according to data obtained by Rep. Park Sung-hoon of the People Power Party, a member of the National Assembly’s National Policy Committee, and released on the 31st. Bithumb’s figures run through the 18th of this month. A single cryptocurrency listed on multiple exchanges was counted once for each listing. Over the same period, 430 altcoins had trading support terminated, a tally that includes coins listed before 2022 and delisted during the period.
The numbers exceed activity on the KOSDAQ market. Over the same period, 532 companies newly listed on the KOSDAQ and 76 were delisted for reasons such as failing to obtain an adequate audit opinion.
The steady stream of quick delistings has raised questions about the exchanges’ ability to screen listings. Thirty-eight altcoins lost trading support less than a year after being listed. Bithumb accounted for the most at 16, followed by Coinone with 11, Gopax with five, Korbit with four and Upbit with two.
Gopax had the highest ratio of terminated listings to new ones at 63.2%, with 67 delistings against 106 listings. Coinone followed at 46.6%, with 157 delistings against 337 listings, and Bithumb at 31.5%, with 134 delistings against 426 listings. Korbit stood at 20.3% and Upbit at 19.2%.
Rapid delistings can leave investors with losses, critics say. Once a delisting is decided, liquidity typically dries up and prices fall sharply, leaving investors who cannot sell in time to absorb the damage.
Park Hyeon-joo, chairman of Mirae Asset Group, recently criticized the exchanges’ altcoin listing practices. Meeting with Korbit employees on the 26th of this month, Park said, “They listed 200 to 300 altcoins and 80% to 90% of customers got soaked,” adding, “That is criminal conduct. Does it make sense for a company to make money doing that?”
A recent race among exchanges to waive trading fees has added to the controversy. Cutting or eliminating fees can draw users and sharply boost trading volume in the short term, but critics warn it can also encourage speculative trading.
Korbit waived trading fees on all coins for 133 days from October 2023 through February 2024. Average daily turnover during that stretch was 70.66 billion won ($51 million), up 1,520.8% from the same length of time immediately before. In the same span right after the promotion ended, average daily turnover fell 57.4% to 30.1 billion won.
Korbit and Coinone rolled out fee waivers again this month, reigniting competition for trading volume. With frequent listings and delistings now compounded by a fee war, concerns are mounting that the exchanges are prioritizing volume growth over investor protection.
Park, the lawmaker, said the practice of passing around coin listings like a live grenade, which fattens exchange revenue while investors absorb the losses, can no longer be left unchecked. He called on financial regulators to strengthen investor protection measures.
#Altcoin#CryptoExchange#Upbit#Bithumb#Korbit#InvestorProtection
Original reporting by Do Ye-ri for Seoul Economic Daily.
AI-translated from Korean. Quotes from foreignxact original wording
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