A prolonged slump in cryptocurrency trading is pushing a growing number of tokens below the thresholds needed to stay listed on South Korean exchanges. Through the third quarter of this year, the number of digital assets dropped from the trading-support lists of the country's five largest won-based exchanges rose to about three times the figure for the same period last year. With another wave of delisting notices and investment warnings this month, analysts say review and disclosure procedures need to be strengthened so that troubled projects can be weeded out without inflicting heavy losses on investors.
A Seoul Economic Daily review of trading-support data from the Digital Asset Exchange Alliance (DAXA) on the 20th found that 103 cryptocurrencies listed at the end of last year had been removed from the trading-support lists of the five largest exchanges by the end of September. That is nearly three times the 40 tokens removed during the same period a year earlier. The count excludes duplicate listings of the same token across exchanges and confirmed rebranding cases.
Exchanges continued clearing out tokens this month. Between the 1st and the 16th, 48 cryptocurrencies, excluding duplicates, were either flagged for the end of trading support or designated as investment-warning tokens. Measures affecting 41 of them were concentrated on the 16th alone. Twenty tokens, including Zilliqa (ZIL), Galaxia (GXA) and Delabs Games (DELABS), were slated for the end of trading support. Another 21, including GemHUB (GHU), Mayflower (MAY) and Ultra (UOS), were classified as investment-warning tokens, meaning their continued listing will depend on the outcome of future reviews.
Behind the rise in delisting reviews is shrinking market liquidity. Under self-regulatory guidelines on trading support drawn up through DAXA, South Korea's five largest exchanges review listings at least once a quarter, examining market capitalization and trading volume among other measures. When those indicators fall below internal minimum standards and raise the risk of user losses, exchanges either designate a token as an investment-warning asset or begin reviewing whether to end trading support.
The problem is that falling prices and shrinking turnover have combined to leave a growing number of tokens unable to meet those standards. According to a financial regulator survey of virtual asset service providers, average daily cryptocurrency trading in South Korea came to about 3.1 trillion won ($2.2 billion) in the first half of this year, less than half the 6.4 trillion won recorded a year earlier. The total assessed value of cryptocurrencies held in the country stood at 58.9 trillion won at the end of June, down 33% from the end of last year.
Market enthusiasm has cooled as persistent geopolitical uncertainty pushed investors toward other assets, including artificial intelligence and semiconductor stocks. Prices of major coins are sharply lower than a year ago. Bitcoin traded at $81,691 as of 3:30 p.m. on the 20th, down about 26.5% from a year earlier, according to CoinMarketCap. Ethereum, the largest altcoin, fell 41.2% over the same period to $2,395, a steeper decline.
Experts said the increase in delistings could improve market soundness but warned that exchanges must distinguish a temporary trading slump from genuine business failure. Park Hye-jin, head professor of AI and digital assets at Sogang University, said reviews based on trading volume alone could force out projects that are only temporarily out of favor. "Exchanges should assess business viability, whether development is continuing and disclosure of circulating supply in a comprehensive way," the professor said. "Clearing out weak projects is a healthy direction in itself, but if assets with real substance — such as tokenized real-world assets or security tokens — do not fill the space left behind, the entire market could contract."
Others called for procedural changes that would give investors enough time to respond. The concern is that when delistings and warning designations are concentrated in a short window, as they were on the 16th, sharp price drops and thin liquidity can magnify losses. Hwang Seok-jin, a professor at Dongguk University's Graduate School of Information Security, said the criteria for delistings and warning designations should be disclosed transparently and that the trading-support review system now run under self-regulation should be written into the Digital Asset Basic Act. Park also said reviews should be conducted on an ongoing basis, with results announced at staggered intervals and an advance warning stage introduced.