South Korea's Financial Watchdog Investigates Coinone After MOVE Token's Massive Price Surge

South Korea’s Financial Supervisory Service (FSS) has launched a formal investigation into the crypto exchange Coinone, following an extraordinary price surge of the Movement (MOVE) token. The token’s value skyrocketed 46,000 times within minutes before plummeting, raising concerns about potential unfair trading practices.

Details of the Price Surge

The MOVE token, built on the Movement blockchain and written in the Move programming language (originally developed for Facebook’s Diem project), was launched during a token generation event on December 9. Shortly after its debut on Coinone, the token’s price surged from 215.3 won ($0.15) to 998,500 won ($697) within minutes, only to crash back to 5,300 won.

This extreme volatility prompted the FSS to investigate whether Coinone adhered to proper procedures during the token’s launch and trading.

Focus of the Investigation

The FSS is examining several aspects of the MOVE token’s trading event, including:

1.Potential Unfair Trades: The agency is investigating whether any irregularities occurred, such as insider trading or market manipulation, during the sharp price swings.

2.Listing Practices: The FSS is reviewing how Coinone handled the listing process for MOVE, particularly since it began trading on Coinone earlier than other major Korean exchanges like Upbit and Bithumb.

The regulator aims to determine whether Coinone’s actions complied with established protocols and whether sufficient safeguards were in place to protect investors.

Implications for the Korean Crypto Market

This investigation comes amid growing scrutiny of the cryptocurrency sector in South Korea, where regulators have been tightening oversight to ensure transparency and fair trading practices. The extreme volatility seen in MOVE’s trading highlights the need for stronger safeguards to prevent such incidents in the future.

Coinone Under the Spotlight

Coinone has not yet issued a public statement regarding the investigation. However, the exchange’s early listing of MOVE compared to competitors has raised questions about its due diligence processes and adherence to industry standards.

The outcome of the FSS investigation could have broader implications for South Korea’s crypto market, potentially leading to more stringent regulations and oversight of exchanges to prevent similar occurrences in the future.

This case underscores the importance of regulatory compliance and investor protection in the fast-evolving cryptocurrency landscape. As the investigation unfolds, all eyes remain on Coinone and the measures regulators may introduce to address these challenges.