Galaxia Foundation “Arbitrary delisting without sufficient opportunity for explanation”
Bithumb “2 months is enough time to call… Buyback in a hurry.”
Representative Hong Jin-pyo, who appeared in court in person, directly refuted and appealed
The court’s decision is expected to be made before 3 p.m. on the 29th.
(Source = Galaxy homepage)
The Galaxia Foundation and the virtual asset exchange Bithumb engaged in a fierce battle on the hearing date for the injunction application over whether to end trading support. Galaxia claimed that Bithumb arbitrarily decided to delist without providing a sufficient opportunity for explanation, while Bithumb claimed that exceeding the circulation volume was a significant violation of the contract and provided sufficient opportunity for explanation.
At 10:30 a.m. on the 26th, a hearing was held at the Seoul Central District Court on the application for a temporary injunction filed by Galaxia SG, issuer of Galaxia (GXA) coin, against virtual asset exchange Bithumb to suspend the effect of termination of transaction support. Galaxia SG, the Singaporean subsidiary of Galaxia Money Tree and the issuer of Galaxia tokens, filed an application for provisional injunction against Bithumb earlier on the 22nd.
Galaxia said, “Unlike the Wemix or Paycoin cases, the key point in this case is that the distribution volume changed due to hacking,” and argued, “Bithumb unilaterally and arbitrarily decided to delist the cryptocurrency without sufficient explanation before the end of transaction support.”
Galaxia’s lawyer said, “Due to the hacking, 380 million coins were released into the market, and we bought back 100 million coins first and reported on the market situation for the remaining 280 million coins.” He added, “We communicated with Bithumb to ensure investor protection and security.” “They unilaterally decided to end transaction support just as we were requesting to prevent recurrence,” Galaxia said, adding, “There was no feedback on what measures were needed or what was lacking during the explanation process, and only emails were exchanged, not face-to-face.” did.
On the other hand, Bithumb claimed that it had given two months enough time to explain. Bithumb’s lawyer said, “The creditors say they bought back all (excess tokens), but in fact, only up to 100 million tokens were bought back until the decision to end support, and 280 million were bought back after the decision to end transaction support.” He emphasized.
Bithumb said, “We bought back in haste because they wanted to suspend trading, not when we gave them a chance before designating it as a cautionary stock,” and added, “The Korea Internet & Security Agency (KISA) is currently investigating what happened to the 380 million that disappeared afterward, but as of now, “I don’t know exactly (whether it was hacked or not),” he added.
In response, Galaxia countered that it had bought back 100 million units in line with the maximum distribution amount initially planned. Hong Jin-pyo, CEO of Galaxia SG, who appeared in court on this day, said, “When we first listed on Bithumb, we shared eight wallets and shared the maximum distribution plan for each wallet. On November 17th, when the incident occurred, we knew (each other) that the circulating supply of one hacked wallet was 280 million Max. “Because 380 million were hacked, 100 million were bought back and incinerated first,” he refuted.
CEO Hong Jin-pyo said, “I asked Bithumb what they needed, but there was no answer. “We did not receive feedback that 280 million more units were needed in addition to the 100 million units, so we proceeded based on internal judgment,” he said. “If Bithumb had given feedback (that additional buybacks were needed), of course we had the intention and ability to do so.” He said.
In addition, in his final remarks during the interrogation, CEO Hong said, “If the delisting of the company is decided, the people who will be harmed are me, my employees, and actual investors,” and appealed, “I hope that you make a decision that will increase the value of the cause of investor protection.”
Bithumb is delisted, Gopax is quiet… Famous office doctor
Meanwhile, Gopax, another exchange belonging to the Digital Asset Exchange Association (DAXA), which supports transactions with Galaxia, is still designating Galaxia as a cautionary stock. Galaxia was designated as a stock of note by Daksa on November 7 last year, but the decision to delist it was different for each exchange. In response to this, there was criticism from the industry that the criteria for delisting are still made arbitrarily by the exchange, along with the theory that Daksa is useless.
Even at the trial on this day, it was pointed out that the standards for commercial depreciation were still ambiguous. Galaxia’s lawyer said, “The basis for termination of transaction support can be seen as the listing contract rather than the law, and the listing contract is in fact the terms and conditions. “This is because it is applied almost equally to all listed tokens.”
He continued, “The legal basis for terminating transaction support when a problem arises even though it falls under the terms and conditions is too unclear, and it is done only with vague provisions for public interest or investor protection.” “However, if you are expelled from a market-dominant exchange such as Upbit or Bithumb, your capital “It will be difficult to maintain the procurement function or proceed with future projects, and irreparable damage will occur,” he emphasized.
On the other hand, Bithumb emphasized that “listing virtual assets is a contract,” and countered, “If a significant violation occurs, we have no choice but to terminate transaction support to create a healthy market and protect investors.” He went on to say, “There are cases of re-listing in the future, such as Wemix, so in that respect, I don’t think there is a need to accept the request for a preliminary injunction.”
This Galaxia case was assigned to the 50th Civil Division, which had previously decided to dismiss the PayCoin injunction application. Wemix and Paycoin, which were delisted after being designated as cautionary stocks in the past, filed for injunction against exchanges, but were dismissed. However, in this case, the issue of the reason for designation as a cautionary stock is different, and it is noteworthy that the entity that made the decision to close the stock was not Docsa.
The court announced that it plans to review additional materials and make a decision as quickly as possible. Since the scheduled closing time is 3 p.m. on the 29th, the results are expected to come out before then.