FTX Bank Run Incident... Domestic Exchanges "No Insolvency Situation"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Lee Jung-yoon] Amid the liquidity crisis of the global cryptocurrency exchange FTX, which triggered a bank run (a situation where customers withdraw coins all at once), domestic exchanges have stated that there will be no insolvency situation.

On the 10th, domestic exchanges announced through their websites, "Investors' cash and assets are safely stored, and there is no risk of insolvency, so please rest assured."

They added, "The Digital Asset Exchange Association (DAXA) is reviewing the virtual assets supported by its member companies and monitoring the market situation," and explained, "In the event of a crisis requiring investor caution, we will continue to provide prompt information and implement investor protection measures through joint response." DAXA is an association composed of the five major Korean won market exchanges: Upbit, Bithumb, Coinone, Korbit, and Gopax.

They also urged investors to exercise caution. They said, "Due to recent issues at overseas exchanges and related companies, volatility in the virtual asset market as a whole is increasing," and "We ask for investors' special attention."

Earlier, FTX faced a liquidity crisis after the financial vulnerability of its affiliate Alameda Research was revealed and a bank run occurred. The crisis worsened when Binance, the world's largest exchange, announced it would acquire FTX but reversed the decision within a day.

This content was produced with the assistance of AI translation services.