South Korea's crypto market sees 34.9% delisting rate instability

The South Korean cryptocurrency market is facing challenges as a significant number of listed cryptocurrencies are being delisted from local exchanges. 

According to local reports, 34.9% of all virtual assets listed in South Korea between January 2018 and August 2024 were delisted. 

This equates to 517 out of 1,482 digital assets, with more than half of the delisted assets lasting less than two years. 

The average listing period for these delisted cryptocurrencies was approximately 748 days, or just over two years. 

The short lifespan of these digital assets indicates a volatile market environment, where many coins experience an initial surge in value but fail to maintain long-term momentum. 

As a result, these assets are eventually removed from trading platforms, leading to investor losses. 

Regulatory gaps contribute to this volatility, giving exchanges significant control over listing and delisting decisions. 

Despite South Korea’s Virtual Asset User Protection Act, enacted in July 2023, there are still no clear standards for these actions. 

The lack of comprehensive guidelines allows exchanges like Upbit and Binance to exercise broad discretion. 

Binance, for example, regularly reviews digital assets to ensure compliance with internal and industry standards. 

“According to DeSpread, Upbit, South Korea’s largest exchange, rarely listed meme coins for two consecutive days. 

However, according to the latest Korean regulations, new meme coins will need to be traded for two years before they can be listed,” WuBlockchain reported. 

This unregulated environment increases investor risks as delistings lead to decreased liquidity, making it challenging for holders to exit their positions without incurring heavy losses. 

Moreover, new global regulations may force exchanges to delist cryptocurrencies that fail to meet emerging legal requirements. 

This could include non-compliant projects lacking transparency or proper user fund management. 

South Korea’s competitive exchange market drives platforms to pursue new listings aggressively to attract liquidity and profits. 

However, without stronger regulatory oversight, investor exposure to sudden delistings remains a significant risk in the country's crypto market.