Crypto Exchange of South Korea, Coinnest announces its closure. As per the report, the exchange posts a notice that it will close on Tuesday. After Tuesday, the exchange will no longer be available. In addition to it, the users need to withdraw their funds on their platform. Therefore, by April 30, the users must withdraw all their funds. The exchange lowers withdrawal fees and minimum threshold amount to help in the process.
However, the reasons for the closure are still not known. And, the news is spreading like flu. On the other hand, the company says that a decrease in trading volume is the natural result of the occurrence. It also includes business decisions and regulatory issues that result in the closure.
Coinnest, however, remains a vulnerable link in the world of cryptocurrency. Things like fraud and hacks lead to losses of digital assets. One of the most recent hacks is Cryptopia, QuadrigaCX, etc.
An executive at Coinnest received a jail sentence
As per matter of fact, the decision came after a really bad year for the company. Before a year, authorities arrested one of the executives of the firm. It was because authorities had a suspicion of fraud on the executive. Later, they convicted the fraud. As a result, the executive received a jail sentence. In addition to jail, he also received a fine of 3 billion Korean Won. The amount is approximately equal to about $2.5 million.
Another official, however, has a connection with the closure of the firm. It is due to the official at Coinnest speaks to CoinDesk Korea.
However, CoinDesk lost $5 million this January in an airdrop. At that time, the firm revealed errors in other cryptocurrencies including Bitcoin. According to CoinDesk, some of the cryptocurrencies went to customers because of a computer error. Since then, the exchange tries to distribute We Game Tokens or WGT. It was as a result of the following incident.
Coinnest’s Closure will follow bankruptcy of its rivals
Previously, Coinnest was the third largest crypto exchange in South Korea. With the closure of Coinnest, it follows bankruptcy of some of its rivals. The firms, for instance, Coinbin, Zeniex, etc. are the rivals of Coinnest. However, some of the smaller exchanges suffer general losses on their trading activity. One of the hottest markets, South Korea, was the source of retail inflows in investments. In addition to it, several projects received incredible boosts in South Korea.
However, during the bear market, “Kimchi premium” disappeared. Also, the volume of Korean Won dwindled. Currently, about 2% of BTC volumes are only against Korean Won. Previously, the volumes were 10 %.
Similarly, Coinnest was the market that gave smooth flow to TRON or TX in South Korea. It also gave a boost to QTUM. Coinnest offered exclusive fiat-to-crypto trading in the denomination of Korean Won. But, market operators were suspects of the fraudulent transaction of digital assets.
As a result of closer of Coinnest, the Korean Won volumes will further decrease. It might also affect the prices of Bitcoin Gold, OmiseGo or OMG, Waltonchain or WTN, and Bitcoin Diamond.