Emergence of Coins Below 4 Billion Won Market Cap Amid 'Delisting Fear'

The market downturn has led to a sharp decline in the market capitalization and trading volume of small and medium-sized coins, resulting in a series of designations for caution.

There are 33 coins with a market cap below 4 billion won, raising concerns about the termination of trading support.

After deliberation by exchanges, cautionary designations have been made, with ongoing uncertainty surrounding low market cap coins.

As the downturn in the digital asset (virtual asset) market continues, the number of coins falling below the 4 billion won market cap, which is one of the criteria for maintaining trading support, is increasing. An analysis of listed assets on Upbit, Bithumb, and Coinone revealed that, excluding duplicate listings, there were 9 digital assets that fell below this threshold for more than 30 days in the second and third quarters.

With the second phase of digital asset legislation being pushed forward this year, concerns are growing that low liquidity and low market cap coins may be significantly cleaned up during the regulatory process.

According to industry sources on the 14th, Upbit, Bithumb, and Coinone have designated 3, 14, and 21 digital assets as cautionary items, respectively, due to failure to meet market cap or trading volume requirements this year.

At Upbit, Tottenham Hotspur (SPURS) and GoChain (GO) have been designated. All are Bitcoin (BTC) market items, and GoChain is also supported in the Tether (USDT) market. At Bithumb, Azit (AZIT), Fancy (FANC), and Nestri (EGG) have been designated, while at Coinone, Basid (BAAS), Wiken (WIKEN), and Delabs Games (DELABS) have been designated.

The designated items at Bithumb and Coinone were all traded in the won market.

These measures are in accordance with the trading support best practices established by the Digital Asset Exchange Joint Council (DAXA) last June. According to DAXA's trading support best practices, if the combined market cap of domestic and foreign exchanges falls below 4 billion won for more than 30 days in two consecutive quarters, it may be subject to cautionary designation.

In addition to market cap, trading volume is also included in the review criteria. For digital assets with a combined market cap of less than 50 billion won, if the average daily trading turnover on their own exchange and other won exchanges falls below 1% during the quarter, it meets the trading volume criteria.

The problem is that there are still quite a few low market cap digital assets that have been below these criteria for an extended period. Even if they are not currently designated as cautionary items, the trading support may change depending on future review results, leading to ongoing 'delisting fears' centered around low market cap items both domestically and internationally.

A representative from a project listed on a domestic exchange stated, "As some projects are designated as cautionary items or are at risk of losing trading support on major overseas exchanges, concerns are growing in the domestic market as well," adding, "There is a growing atmosphere of vigilance across the market, with inquiries about trading support coming from some overseas exchanges."

In fact, Icon (ICX), which is considered a leading domestic project, has also recently come under monitoring by overseas exchanges. According to a notice from Binance on the 11th, Binance has included Icon, Moonbeam (GLMR), Moonriver (MOVR), SuperRare (RARE), and Sophon (SOPH) in its monitoring tag application targets.

Binance regularly reviews trading volume, liquidity, development activity, and network stability. If a monitored item fails to meet the listing criteria, trading support may be terminated.

It has been confirmed that many low market cap items that have not yet been designated as cautionary items on domestic exchanges have been below the market cap criteria for an extended period. Based on the daily circulating market cap converted to won from the digital asset market analysis platform CoinMarketCap, an analysis of listed items on Upbit, Bithumb, and Coinone from January 1 to August 13 this year revealed that there were a total of 41 items that fell below the 4 billion won market cap for more than 30 days in the first and second quarters or the second and third quarters, with 33 items after excluding duplicate listings.

Among these, 24 have already been designated as cautionary items or are undergoing procedures for termination of trading support. The remaining 9 have not been designated as cautionary items or received termination of trading support due to market cap.

By exchange, the items that fell below the criteria are 2 at Upbit, 15 at Bithumb, and 24 at Coinone. Among these, the items that have not yet been designated as cautionary items due to market cap are 1 at Upbit, 4 at Bithumb, and 6 at Coinone.

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