Wemade's Wemix token plunges 60% after South Korean exchanges announce delisting

Wemix, the cryptocurrency from South Korean Web3 game developer Wemade, dropped over 60% on Friday after local exchanges announced plans to delist the token for the second time.

Starting around 3 p.m. Friday in South Korea, the price of Wemix plummeted from $0.7225 to a low of $0.2757 in a matter of 15 minutes. It has since recovered to around $0.36 as of publication time, though it remained down 50% compared to the same time yesterday, according to CoinMarketCap data.

The plunge appears to have been triggered by a collective announcement from major local crypto exchanges regarding their decisions to delist the token from their platforms. 

South Korea's five major exchanges — Upbit, Bithumb, Coinone, Korbit and Gopax — are the only platforms where users can deposit fiat to trade crypto, effectively representing the country's entire crypto market. Major decisions on specific tokens are made through DAXA, the Digital Asset Exchange Association, whose members include these five platforms.

Wemix trading is set to cease on these exchanges starting June 2, with token withdrawals ending on July 2, according to the announcement.

$6.2 million exploit

The token, originally developed for Wemade's Web3 gaming ecosystem, was placed on an investment caution list by the major exchanges earlier this year, following a February exploit that resulted in the theft of $6.2 million worth of Wemix tokens from the cross-chain protocol Play Bridge.

However, the Wemix Foundation waited four days before alerting users to the exploit, later explaining the delay as a measure to "prevent market panic." The token's price fell 40% during the four-day period, dropping to $0.42.

DAXA said today that the Wemix Foundation insufficiently addressed the issues that caused the designation as an investment caution cryptocurrency, according to Bithumb's announcement.

"As a result of comprehensively reviewing the issuing entity's credibility and security, we determined that the asset does not meet the criteria for maintaining transaction support," DAXA said.

Wemix token was previously delisted from DAXA member exchanges in December 2022 after the actual number of circulating tokens exceeded the amount stated in its disclosure statement. 

It became the first native token in South Korea to be suspended by trading platforms twice, local news agency Yonhap reported.

Wemix responds

Following Friday's delisting announcement, the Wemix team released a statement apologizing to its community for the token's removal from local exchanges.

"We want to clearly state that the foundation and Wemade have unwavering commitment and belief in the growth of the WEMIX ecosystem, regardless of the domestic exchanges' decision to terminate trading support," Wemix said. "The team will dedicate all available capabilities and resources to swiftly overcome the impact of the trading support termination and return to a normal trajectory."

The project added that it will continue with its buyback of 10 billion Korean won ($7.1 million) worth of Wemix tokens, which was announced in March with the aim of restoring its market value.

Wemade's stock closed down 17.45% at 23,650 won ($16.77) on Friday in South Korea, according to Google Finance data. It is down 32.1% year-to-date.