Wemix Falls 66% Amid Delisting Maintenance... Industry Calls It a Chance to Establish Circulation Standards

[Image source=Yonhap News]

[Asia Economy reporters Jung Yoon Lee and Myung Hwan Lee] The market was shaken as the court dismissed the injunction request to halt the termination of trading support (delisting) for the virtual asset WEMIX issued by Wemade. The industry responded that this decision would establish standards for the circulation volume of virtual assets.

As of 8:26 a.m. on the 8th, the price of WEMIX on the domestic virtual asset exchange Upbit was recorded at 393 KRW, down 66.41% from the previous day. At the same time, WEMIX prices also plunged on other domestic exchanges. On Bithumb, it traded at 370.9 KRW, down 20.06%, and on Coinone, it fell 60.73% to 355 KRW. Korbit recorded the largest drop, down 67.69% to 379.6 KRW. The price of WEMIX on Upbit had maintained the 1,100 KRW range but began to plummet around the time the court’s decision was imminent. It dropped more than 40% in just one hour from 7 p.m. to 8 p.m. the previous day.

The Seoul Central District Court Civil Division 50 (Chief Presiding Judge Song Kyung-geun) dismissed the injunction request filed by WEMIX Limited Liability Company against the exchanges Upbit, Bithumb, Coinone, and Korbit, which belong to the Digital Asset Exchange Association (DAXA). As a result of the court’s decision, WEMIX was delisted from the domestic exchanges affiliated with DAXA?Upbit, Bithumb, Coinone, and Korbit?starting at 3 p.m. that day.

The court ruled that although WEMIX investors might incur losses, the decision was made to ensure transparency in the virtual asset market. Additionally, the fact that WEMIX trading remains possible on other domestic and international exchanges outside of DAXA, and that withdrawals can be made for a certain period despite delisting, also influenced the decision.

Earlier, on the 24th of last month, DAXA decided to delist WEMIX citing significant violations of circulation volume, inadequate or incorrect information provided to investors, errors in submitted documents during the explanation period, and damage to credibility. However, despite the dismissal of the injunction request, Wemade has stated it will proceed with the main lawsuit and file a complaint with the Fair Trade Commission, so the dispute is expected to continue.

Exchanges affiliated with DAXA expressed their respect for the court’s judgment regarding this decision. The industry also reacted that this would serve as an opportunity to establish standards for circulation volume. The incident began with suspicions that the circulation plan and the actual quantity differed. An industry insider said, "Although there was an agreement on the concept of circulation volume, investors’ understanding was insufficient. If the injunction had been granted, delisted coins would have set a precedent of always going through the courts."

Another insider said, "Although there are no laws related to virtual assets, this result is recognition that DAXA can implement investor protection measures through self-regulation. It also sounded a warning to the industry regarding circulation volume issues."

Experts emphasize the importance of restoring trust in the plummeting coin market. Professor Ki-Hoon Hong of Hongik University’s Department of Business Administration explained, "We must give investors confidence that such incidents will never happen again. We need to create measures to prevent recurrence and avoid attitudes that imply we did nothing wrong."