Bithumb, which is one of the biggest South Korean cryptocurrency exchanges, is causing a controversy as it announced that it will be listing a coin that has not gone through ICO (Initial Coin Offering).
Many cryptocurrency communities are criticizing Bithumb for just focusing on making money by using its position as a large exchange and selling domestic coins that do not have proper requirements. They are pointing at Bithumb’s domestic coin as a ‘strategic con’ that aims for enormous amount of profit.
According to industries on the 16th, Bithumb made an announcement that it will be listing its digital contents distribution service platform called ‘POPCHAIN’, which was developed to help creators and consumers earn profits without any intermediaries, on the 17th.
POPCHAIN is a cryptocurrency that has not gone through ICO at large cryptocurrency exchanges in foreign countries. Its value cannot be compared, and it is sold by exchanges that have listed POPCHAIN.
Although Bithumb made the white paper of POPCHAIN public, development process and future plan of POPCHAIN are very abstract. Moreover, the white paper does not contain any information on how POPCHAIN will be distributed. POPCHAIN will only be available for Bithumb users and it will not be available in foreign countries.
What does it mean that Bithumb is planning to list a cryptocurrency that has not gone through ICO?
Listing is when a cryptocurrency, which satisfies certain conditions, is allowed to be traded at an exchange. Listing process goes through a review done by a cryptocurrency listing review committee that is composed of experts in this industry.
However, a problem arises as POPCHAIN’s potentials and values are not related to blockchain technology much and as there are suspicions around industry that POPCHAIN’s internal source code is exactly same as the one from another cryptocurrency. Actually, it is confirmed that POPCHAIN’s source code is exactly same as the one from Monero.
Just based on POPCHAIN’s white paper, POPCHAIN can be used to purchase various contents that were downloaded from torrents in the past. Also, it can replace different types of compensations and rewards such as balloons that are given to VJs (Video Jockey).
According to POPCHAIN’s white paper, it is applied with its own POPBOX hardware. POPBOX can be controlled through a Smartphone application and it can be used to download videos or movies just like BitTorrent and to watch TV channels through real-time streaming. POPBOX can be used to mine coin by storing files and providing bandwidth while connecting POPBOX to equipment such as computers or modems that are connected to TVs.
Number of people who actually possess POPCHAIN is also a problem as more than 90% of POPCHAIN is owned by just 2 people.
If number of trades increases due to a growing influx of new investors through trades, an unfair structure where only few number of people who have this cryptocurrency earn profits can be created.
Due to arising problems, Korea Blockchain Association notified Bithumb that it will temporarily stop listing process of POPCHAIN Coin and that it will reexamine POPCHAIN Coin. Korea Blockchain Association decided to take such approach as media and many blockchain experts and investors brought up their concerns towards POPCHAIN Coin.
As a result, Bithumb announced that it will be postponing a listing process of POPCHAIN.
“Due to spread of many false information that are not confirmed, we recognized a rising surge of insecurity towards trades involving POPCHAIN.” said a representative for Bithumb. “Because we can cause unnecessary controversies even more by continuing the listing process of POPCHAIN according to our initial schedule, we decided to restart trades involving POPCHAIN after POPCHAIN is listed on other exchanges.”
Staff Reporter Gil, Jaeshik | osolgil@etnews.com