South Korea’s largest cryptocurrency exchange, Upbit, has strongly denied allegations of charging intermediary fees for token listings.
The controversy erupted after Wu Blockchain, a prominent digital asset news source, claimed multiple projects had paid hefty sums to secure a listing on Upbit and its competitor, Bithumb.
According to Wu Blockchain, projects reported paying intermediary fees of up to $10 million to Upbit-related parties and market makers, a claim that has sent ripples through the crypto industry.
Upbit Refute All Claims, Demands Evidence
In response, Upbit released an official statement refuting these allegations, asserting that the exchange does not accept any form of monetary compensation in exchange for listing a token.
The statement emphasizes that Upbit follows a rigorous internal evaluation process to determine whether a digital asset qualifies for trading support.
Upbit has called on Wu Blockchain to substantiate its claims with specific evidence, including disclosing the names of the projects allegedly involved in such transactions.
Additionally, Upbit warns users against fraudulent brokers who falsely claim to be able to secure listings on the exchange.
Upbit maintains that any third-party claims guaranteeing listing approvals in exchange for fees are entirely fraudulent.
The company has urged project teams and investors to report any suspicious intermediaries through its official fraud reporting channels.
In addition, the exchange has vowed to take legal action against any individuals or entities engaging in such fraudulent activities.
Wu Blockchain’s Claims and the Industry’s Response
Wu Blockchain’s report alleged that several projects had paid substantial intermediary fees to gain listings on Upbit and Bithumb.
According to their sources, fees ranged from 3% to 5% of the total token supply or direct payments amounting to millions of dollars.
While some projects confirmed making such payments, others claimed they had not engaged in any fee-based listing negotiations.
The report further suggested that the intermediaries facilitating these alleged transactions had connections to Upbit’s shareholders and market makers.
Wu Blockchain, however, has declined to provide specific details or disclose the identities of the involved projects, citing the need to protect its sources.
Instead, the outlet has urged Korean regulators to conduct a thorough investigation into Upbit’s and Bithumb’s listing practices, particularly regarding the role of market makers in the process.
In response, Upbit not only denied the allegations but also challenged Wu Blockchain to present concrete proof.
The exchange reiterated that all listing decisions are based solely on strict evaluation criteria without external influence.
Regulatory Pressures Facing Upbit and Bithumb
These allegations come amid heightened regulatory scrutiny of Upbit and other major South Korean crypto exchanges.
Earlier this year, both Upbit and Bithumb were fined a combined $2.4 million after being ordered to compensate users for platform outages that occurred during the so-called “Martial Law Day” crisis on December 3, 2024.
The incident caused Bitcoin’s price to plummet on domestic exchanges, resulting in mass trading disruptions and preventing users from completing transactions.
Following the crisis, regulators demanded that exchanges strengthen their technical infrastructure.
South Korea’s Financial Supervisory Service (FSS) conducted on-site inspections to ensure compliance, instructing platforms to expand server capacity and improve emergency response systems.
Additionally, Upbit faces potential sanctions from the Financial Services Commission (FSC) for over 700,000 Know Your Customer (KYC) violations.
Authorities suspect that the exchange failed to properly verify customer identities, raising concerns about possible illicit financial activities.
Upbit could face multi-million-dollar fines and restrictions on its operations, including a temporary suspension of new user registrations.
As it stands, the listing fee allegations, combined with the KYC violations, have intensified scrutiny over Upbit’s operational integrity.
Although Upbit has denied all claims of pay-for-listing schemes, ongoing regulatory attention signals the need for continued investigation into the exchange’s practices.
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