In a recent announcement made by the Digital Asset Exchange Alliance (DAXA), members of the joint consultative body announced the end of Paycoin (PCI) transaction support. The group, which includes major South Korean digital asset exchanges such as Upbit, Bithumb, Coinone, Korbit, and Gopax, revealed that they will no longer support the Paycoin cryptocurrency from 3:00 p.m. on April 14th.
The news has sent shockwaves throughout the cryptocurrency market, with the price of PCI plunging by 60% in just one hour following the announcement. At the time of writing, PCI is trading at $0.12 (161 won), down from its previous value of $0.30.
Paycoin, which is developed on Hyperledger Fabric (HLF), is a cryptocurrency payment platform that aims to provide a simple and convenient payment solution for both e-commerce and retail use. The project is supported by Danal, a payment company based in South Korea.
Unlike general blockchains where anyone can participate in data processing, HLF is a private blockchain where only authorized nodes can join the network. This ensures fast transaction speeds and excellent privacy, making it ideal for payment services.
The decision by DAXA to end support for PCI is a significant blow to the Paycoin project and its supporters. It is unclear at this time what led to the decision, but it is likely to have been driven by a range of factors, including concerns over regulatory compliance, security, and market demand.
The move highlights the challenges faced by cryptocurrency projects and exchanges, which are often subject to intense scrutiny and regulatory pressure. It also underscores the importance of maintaining strong relationships between digital asset exchanges and their clients, as well as the need for transparency and clear communication.
Update:
According to an announcement by Upbit, on January 6, 2023, the Korean Financial Intelligence Unit (FIU) issued a cautionary notice regarding Paycoin (PCI). The notice was related to the non-issuance of real-name confirmation deposit and withdrawal accounts on the Paycoin side, and the failure to report changes to virtual asset operators. The FIU had designated PCI as a cautionary item due to the potential impact on PCI-related services if these issues were not resolved.
Initially, the notice period was set until February 6, 2023, but Upbit extended it until March 31, 2023, to facilitate the clarification process. However, as the Paycoin side failed to address the reasons for the cautionary designation, including the lack of real-name verification deposit and withdrawal accounts and incomplete reporting on the change of virtual asset operator, domestic payment services using PCI were effectively halted.
Upbit reviewed the foundation’s plans to address the issues, including changes to the business plan and timeline for issuing real-name verification deposit and withdrawal accounts on the Paycoin side. However, considering the fast-paced business environment and the direction of the overseas payment business, Upbit concluded that continuing transaction support could potentially cause further investor damage. Therefore, the decision was made to terminate transaction support for PCI.
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