Wemix, a cryptocurrency issued by Wemade, will be delisted from five Korean crypto exchanges, the companies said Thursday night.
The five exchanges — Upbit, Bithumb, Coinone, Korbit and Gopax — will stop the trading of Wemix coins from Dec. 8. Owners will be able to withdraw their money for a month after trading ends.
The decision comes a month after Wemix was flagged with an Investment Warning by the Digital Asset eXchange Alliance (DAXA), a trade group representing the five exchanges, on Oct. 27 because of the differences between the number of tokens that were to be distributed according to company disclosures and the actual number outstanding.
The company reported last January that it expects 245,966,797 Wemix tokens to be available as of Oct. 31, but on Oct. 25, there were 318,421,502 Wemix tokens — a 72,454,705 difference.
Wemix plunged from 2,200 won ($1.7) on Thursday to 800 won on Friday morning. Wemix coins have lost about 95 percent of their value since November last year.
“There were numerous errors found in the files they handed in and they repeatedly changed the contents of the files even after submission,” Upbit said. “A rare situation has occurred where our level of trust in management capability has plummeted to a point where it cannot recover.”
Wemade CEO Chang Hyun-guk had assured investors that the possibility of delisting is “almost zero” in a press conference held Nov. 2.
According to Chang, the difference occurred because the company failed to immediately report additional tokens to the market as it was planning to do so in a quarterly report scheduled for the end of the year.
The comment had a negative influence on DAXA officials and led to Thursday’s decision, according to local news outlet Block Media.
“Chang Hyuk-guk’s assurance that ‘Wemix will not be delisted’ had a negative effect,” a DAXA official reportedly told Block Media.
Shares of Wemix, a game publisher, have lost about 85 percent of their value since hitting a peak in November 2021. The company closed at 56,200 won on Thursday and started trading at 39,400 won on Friday morning, down 30 percent from the previous day.
CEO Chang will hold a press conference at 11 a.m.
BY YOON SO-YEON [email@example.com]