Major South Korean cryptocurrency exchanges Upbit and Bithumb have halted deposits for Synthetix (SNX) following a warning from the Digital Asset Exchange Alliance (DAXA), which flagged the asset as requiring investor caution.
DAXA, the self-regulatory organization that defines industry standards for South Korean exchanges, has categorized SNX as a high-risk token. This designation typically results in increased scrutiny, with exchanges often responding by issuing warnings and suspending deposits or trading to safeguard investors from potential volatility.
Upbit Implements Cautionary Measures for SNX
In a recent announcement, Upbit revealed that it has applied a cautionary label to SNX and temporarily blocked deposits of the token. The exchange cited concerns over Synthetix’s stablecoin, sUSD, which has recently lost its dollar peg. Since SNX serves as collateral for sUSD, this instability could pose serious risks for investors.
Upbit further expressed concerns regarding the ambiguous use cases for SNX, indicating that it would perform a thorough evaluation to consider a possible delisting of the token.
Synthetix ( $SNX ) stablecoin’s been off the peg for 50 days.
South Korea said “nah,” and now deposits are frozen till May 2025.
Stablecoin vibes? Not so stable. pic.twitter.com/49WeYR2Zmr
— GmHodler (@GmHodler) April 24, 2025
Bithumb quickly followed Upbit’s lead, also suspending SNX deposits and releasing a similar cautionary notice. However, Bithumb has suggested that the restrictions might be lifted if the underlying issues are addressed.
Other significant exchanges in South Korea, including Korbit and Coinone, have issued alerts related to SNX. While they have attached cautionary labels, they have not yet suspended deposits or trading activities.
This increased scrutiny from the exchanges comes on the heels of sUSD experiencing a sharp decline, falling far below its intended dollar peg.
On April 10, the sUSD stablecoin dropped to $0.83—the lowest price observed in five years—and continued its descent, hitting $0.68 by April 18. Meanwhile, SNX, the primary token of the Synthetix protocol, has seen a 26% decrease in value over the past month.
Kain Warwick, founder of Synthetix, has recently urged SNX stakers to embrace a new staking mechanism aimed at stabilizing sUSD. He warned that lacking participation could lead to penalties.
The newly introduced sUSD 420 Pool, launched on April 18, promises participants a share of 5 million SNX tokens over a 12-month period if they commit their sUSD to the pool for a full year.
Despite these initiatives, sUSD has only partially recovered, reaching $0.87 on April 24, yet still struggling to regain its dollar peg.
Challenges Persist Within the Stablecoin Market
Instances of stablecoins losing their pegs are not unusual. In March 2023, USDC briefly fell below its dollar peg after Circle revealed that $3.3 billion in reserves were frozen at the failed Silicon Valley Bank.
Similarly, TrueUSD (TUSD) dipped below $1 earlier this year amid a surge of redemptions.
Notably, despite these setbacks, the stablecoin sector has continued to expand, with its total market capitalization exceeding $200 billion in 2025 and transaction volumes rising to $27.6 trillion, surpassing the combined annual volume of Visa and Mastercard.
At a Senate hearing in March, Federal Reserve Chair Jerome Powell expressed the central bank’s support for developing a regulatory framework for stablecoins, emphasizing the necessity of consumer and saver protections.
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