[why&next]"No Delisting" Legal Action... What Is the Fate of WEMIX?

Many Injunction Requests Related to Coin Delisting Rejected
Daksa "Proceeding with WEMIX Delisting Decision as Planned"

[Asia Economy Reporter Ji Yeon-jin] Wemade has strongly opposed the decision to delist WEMIX, its self-issued coin, from the top 5 domestic virtual asset exchanges and has taken legal action.

On the 28th, Wemade announced that it will file an injunction to cancel the delisting decision against the top 5 virtual exchanges within this week, and plans to file a complaint with the Fair Trade Commission against the Digital Asset Exchange Association (DAXA). On the 25th, Wemade CEO Jang Hyun-guk held an emergency press conference, stating, "Even now, if you enter Upbit, there are countless coins without disclosed circulation plans," adding, "We cannot stand by this unfairness."

Earlier, on the 24th, DAXA decided to terminate trading support (delisting) for WEMIX. The reasons cited include discrepancies between the issued and circulating amounts of WEMIX disclosed by Wemade, providing incorrect information through corporate disclosures, and damaging trust in virtual assets due to errors in materials submitted during the explanation period.

Wemade plans to proceed with legal procedures early this week so that the injunction can be granted before the 8th of next month, prior to WEMIX’s delisting. If the court accepts this, WEMIX can continue trading on the top 5 virtual exchanges as it does now. However, the virtual asset industry atmosphere suggests that the likelihood of the injunction being accepted is low, as courts have so far ruled that exchanges have the authority to decide on coin delisting in injunction applications.

In fact, injunction applications to suspend the effect of trading termination decisions filed by the issuers of Pikacoin, which was delisted on Upbit, and Dragonvein Coin against Bithumb Korea were dismissed by the court.

In particular, the incorrect information disclosure regarding WEMIX not only undermines the trust, which is the prerequisite for all transactions, but also may cause investor damage, leading to the view that the delisting is unlikely to be withdrawn. A virtual asset industry official said, "Wemade, as a listed company, disclosed information about WEMIX through highly trusted disclosures by investors, but this did not actually match," adding, "The decline in trust in virtual assets and investor damage caused by incorrect information is significant."

There is a prevailing view that Wemade’s complaint to the Fair Trade Commission regarding the 'gapjil' (abuse of power) of virtual asset exchanges will also make it difficult to overturn the delisting decision. To consider the WEMIX delisting as unfair collusion among the top 5 KRW exchanges, the exchanges would need to profit from DAXA’s delisting decision; however, supporting WEMIX trading is actually more profitable.

A DAXA official stated, "DAXA’s decision can only be jointly responded to if all companies supporting trading can terminate trading, so Wemade’s legal actions will not change DAXA’s decision," adding, "We will observe the legal procedures and results filed by Wemade."

Meanwhile, the Financial Supervisory Service has begun monitoring market conditions after the WEMIX delisting decision and has started institutional reviews related to delisting criteria in the virtual asset market. Although there is a legislative gap regarding virtual assets and the Financial Supervisory Service does not have legal authority to manage or supervise the WEMIX delisting, it intends to examine whether there are areas for improvement from an institutional perspective.