Bithumb Designates Velo Protocol’s VELO Token as Cautionary Cryptocurrency
Bithumb, South Korea’s largest cryptocurrency exchange, has designated Velo Protocol’s VELO token as an investment cautionary cryptocurrency effective February 22, 2023. The exchange cited lack of transparency into Velo’s business activities and failure to comply with previous improvement requests as reasons for the designation.
Deposits of VELO Suspended
Starting at 4PM KST on February 22, deposits of VELO will be suspended by Bithumb. The exchange will reevaluate the status of the token in early March and decide whether to extend the cautionary designation. During this period, Velo Protocol will have the opportunity to resolve the cited issues and request removal of the cautionary status.
Bithumb’s Investment Cautionary Designation Policy
Bithumb implemented its investment cautionary designation policy to protect investors by providing warnings about potentially concerning cryptocurrencies offered on its platform. Cryptocurrencies can be designated cautionary for reasons including lack of transparency, rumors of misconduct, technical vulnerabilities, and regulatory noncompliance.
Reasons for Cautionary Designation
Bithumb stated that it has been unable to verify details of Velo’s business activities and development progress. Additionally, Velo allegedly failed to comply with all provisions of a previous improvement request. Bithumb now considers additional investor protections necessary.
About Velo Protocol
Velo Protocol, developed by Velo Labs, issues VELO tokens on the Stellar blockchain. The protocol aims to facilitate fast, affordable, and secure transactions by connecting traditional financial partners and cryptocurrency providers to enhance liquidity and interoperability.
Bithumb’s Commitment to Oversight
Bithumb expressed its commitment to sustainable and systematic oversight of listed cryptocurrencies. The exchange aims to provide a sound trading environment through open communication and coordination with external experts and project foundations.
Hot Take: Bithumb’s Cautionary Designation Raises Transparency Concerns for Velo Protocol’s VELO Token
Bithumb’s designation of Velo Protocol’s VELO token as an investment cautionary cryptocurrency highlights concerns about transparency and compliance. As a crypto enthusiast, it is important for you to consider the potential risks associated with investing in cryptocurrencies that lack transparency and fail to comply with improvement requests. Bithumb’s decision to suspend deposits of VELO serves as a reminder of the importance of due diligence before making investment decisions in the crypto market. Stay informed and stay cautious to protect your investments.
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