Upbit "Wemade, WEMIX Admit False Disclosure... Denounced as Abuse of Power"

[Image source=Yonhap News]

[Asia Economy Reporter Heo Kyung-jun] Upbit, a cryptocurrency exchange, has expressed its position regarding the false disclosure by Wemade, the issuer of the cryptocurrency 'WEMIX'. Wemade criticized the decision to terminate WEMIX trading (delisting) as "Upbit's superpower abuse."

The Digital Asset Exchange Joint Council (DAXA), composed of the five major domestic cryptocurrency exchanges?Upbit, Bithumb, Korbit, Coinone, and GOPAX?announced that WEMIX, designated as an investment caution item, will be delisted on the 8th.

Subsequently, Wemade filed an injunction with the court to prevent the delisting, arguing that the delisting of WEMIX was unfair despite sufficient explanations. The court decided to rule on Wemade's injunction request by the 7th of this month, one day before the delisting.

On the same day, Upbit released a statement titled "Upbit's Position on the Termination of WEMIX Trading." Upbit stated, "We judged that the excess circulation volume beyond the WEMIX distribution plan submitted by Wemade was significant, and after discussions within DAXA, we decided to terminate trading support."

It further explained, "Circulation volume is a very important factor in forming price value. Upbit discovered that the WEMIX circulation volume was falsely disclosed in October and requested an explanation from Wemade. Wemade acknowledged in an email reply on October 21 that approximately 10 million WEMIX were excessively circulated and falsely disclosed."

Upbit also reported that Wemade reversed its position on October 25, admitting to an excess circulation of 72 million WEMIX.

Upbit criticized, "Regarding the excess circulation, Wemade explained that they did not know whether disclosure was necessary each time the circulation volume changed and cited 'ignorance of the person in charge.' While it is problematic that a Wemade employee mistakenly made a false disclosure of the circulation volume, it is a bigger issue if they knowingly submitted incorrect data."

Additionally, Upbit claimed there were circumstances suggesting Wemade attempted to conceal wrongdoing by providing only favorable data during the explanation process.

Upbit stated, "When requesting data on the Cocoa Finance collateral volume, Wemade submitted only data prior to October 11, the date WEMIX was transferred for collateral deposit. This is a suspicious matter indicating that WEMIX's side knew that providing coins as collateral counts as circulation and tried to hide it."

Furthermore, Upbit revealed that during the investigation into the WEMIX circulation volume issue, multiple serious problems involving executives and employees were identified, and they plan to submit related details to the court once the review is completed.