Here’s Why Microsoft-Backed WEMIX Token Crashed

WEMIX token has crashed almost 99% from its all-time high noted in the month of November last year but is up 21% in the last 24 hours.

On Thursday, South Korea’s top five cryptocurrency exchanges declared that they will no longer be trading the gamefi token WEMIX. According to local media, this is the result of WEMIX spreading misinformation that confused investors.

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Game token WEMIX will be delisted from the South Korean cryptocurrency exchanges Upbit, Bithumb, Coinone, Korbit, and Gopax, which make up the Digital Asset eXchange Alliance (DAXA). Just a few weeks before this decision, Microsoft had invested $14.8 million in WEMADE.

The token crashed significantly and as per CoinMarketCap, the token is more than 99% lower from it’s all-time high of almost $25 witnessed in November 2021. However, at the time of writing, the WEMIX token is more than 20% up in the last 24 hours despite the announcement of delisting in December.

WEMIX, a subsidiary of WEMADE, is a worldwide gaming platform that features digital asset wallets. WEMIX stablecoin was released on the platform in the month of October.

Henry Chang, CEO of WEMADE said: 

“This is a meaningful investment by reputable financial and strategic investors with proven track records. Wemade and Wemix will continue to exert efforts to attract more capital and actively invest to build the global digital economy platform.”

In the announcement, DAXA noted that the investors’ misunderstanding caused by the false information made it more difficult to track down and handle crucial data pertaining to the project.

The notice further stated that the cryptocurrency exchanges would cease supporting WEMIX transactions at 3pm UTC on December 8. WEMIX token prices dropped by almost 60% across all five main exchanges once the news broke.

WEMIX Was Warned Earlier

However, this is not unexpected given that four out of five South Korean cryptocurrency exchanges placed the token to its “investment warning” list in October due to inflated circulation numbers. 

According to WEMADE’s report to Upbit, a cryptocurrency exchange that was raided earlier this year following the LUNA catastrophe, the real number of tokens in circulation in January was approximately 72 million, although the WEMIX estimated 245 million.

After that, DAXA launched a 2-week investigation into the situation and threatened to discontinue its partnership with the platform if the problem was not remedied. In response, WEMADE admitted that it erred by excluding some of the WEMIX tokens that are required as deposits when extending loans and administering the ecosystem.

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