Is a Wave of Altcoin Delistings Imminent in South Korea? Here’s What You Need to Know

There are growing fears that South Korean cryptocurrency exchanges may start delisting various altcoins this year due to pressure from financial authorities.

According to a report from Business Post, there is a significant concern that altcoins will be removed “one after the other” in the coming weeks, reminiscent of the large-scale delistings that occurred in 2021.

Industry Officials Fear Repeat of 2021 Purge

In 2021, many South Korean crypto exchanges removed numerous low-cap coins from their platforms in anticipation of regulatory action. This action was prompted by an increase in public scandals involving fraudulent coins, leading regulators to demand stricter oversight.

Now, with similar conditions emerging, officials are calling for exchanges to conduct regular audits of listed coins.

Officials have indicated that tokens that underperform, lack transparency, or show little recent development should be placed on cautionary lists. A source within the industry stated, “We cannot rule out the possibility that many altcoins will be delisted at once,” echoing the mass cull of altcoins in 2021.

Regulatory Guidelines and Market Impact

The Financial Supervisory Service (FSS) is expected to introduce a set of “best practices” for exchanges to follow when making delisting decisions. These guidelines are anticipated to coincide with the launch of the Act on the Protection of Virtual Asset Users, scheduled to take effect on July 19.

An anonymous crypto industry official noted that the news has already caused lower-cap altcoin prices to drop on major exchanges.

Despite these fears, leading South Korean exchanges are urging calm. Upbit, a major crypto exchange, reassured users in a June 19 press release, stating, “It is very unlikely that any such large-scale delistings will take place.”

They emphasized that higher-cap coins with strong international reputations, such as XRP, Solana, and Cardano, are not expected to be affected.

In conclusion, while concerns over mass altcoin delistings in South Korea are mounting, top exchanges are confident that only lower-cap, less transparent projects will face scrutiny.

As regulatory guidelines are introduced and the new Virtual Asset Protection Act comes into effect, the market will likely see increased oversight aimed at protecting investors.

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies
ABOUT THE AUTHOR See More
Avatar
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
Related Articles
Comments
0 0 votes
Article Rating
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments