South Korean blockchain startups are listing their cryptocurrencies on overseas exchanges one after another. Foreign exchanges have opened the Korean won money market to attract South Korean cryptocurrency projects.
The number of South Korean companies listing their early-stage blockchain projects on foreign exchanges is steadily increasing, industry watchers said on Aug. 18. Medibloc and Temco, which have already listed their blockchain projects on South Korea’s major exchanges are seeking to list their projects listed again on overseas exchanges, including those in the United States and Singapore.
Leading global foreign exchanges are scrambling to open the Korean won market to enter the domestic market. Some foreign exchanges, including Binance Labs, are directly accelerating Korean blockchain projects to attract Korean startups.
BW.com, which recently attracted domestic blockchain projects such as Ziktalk, Storichain, Payexpress and Sigma Chain, is planning to absorb domestic cryptocurrency investors by opening the won market by the end of this month. BW.com is a China-based cryptocurrency exchange which ranks among the top 10 in the world in terms of transaction volume. The exchange is regarded as useful for domestic projects to make inroads into the Chinese and Southeast Asian markets.
Sigma Chain, the developer of South Korean blockchain platform Futurepia, undertook the initial exchange offering (IEO) of its own cryptocurrency PIA on BW.com in May, becoming the first Korean company to do so.
Bitholic, which is to change its name to “Bithumb Singapore,” also owns a large number of domestic blockchain projects in its portfolio. In particular, BOScoin completed the listing of its cryptocurrency on Bitholic in June. The exchange also supports trading of the cryptocurrencies of such projects as Bezant and Medibloc.
Experts point out that domestic blockchain projects are flocking to foreign exchanges largely due to tougher domestic cryptocurrency exchange market conditions. Investors cannot make or withdraw deposits in the Korean currency at Korean exchanges. Excluding the nation’s four largest exchanges, some 200 smaller exchanges cannot open real-name virtual accounts. This is one reason cryptocurrency investors cannot benefit from investor protection.
A low transaction volume is another reason Korean blockchain startups avoid listing on domestic exchanges. Only five or six South Korean exchanges rank among the top 100 in the world in terms of transaction volume. It is no exaggeration to say that 97 percent of domestic exchanges are in danger of going bankrupt due to their low volume of transactions.
Prixbit, a cryptocurrency exchange which closed its operations as of Aug. 9, has failed to overcome its financial difficulties and suspended its cryptocurrency trading services. Many investors criticized the shutdown of the exchange as they were worried about withdrawing their investments.