Microsoft-backed Wemade, a South Korean online games company with blockchain interests, said it would take legal action against DAXA (Digital Asset Exchange Alliance). DAXA, an association of South Korean cryptocurrency exchanges, recently decided to delist Wemade’s token Wemix, triggering Wemade’s response.
Earlier this month, Wemade received $46 million in funding, of which Microsoft invested $14.8m through convertible bonds. The other backers were Shinhan Asset Management and Kiwoom Securities. Following the investments, the company announced its plan to release NILE, a DAO-powered blockchain, which will include a marketplace for NFTs.
Circling back to the Wemix token, DAXA found that Wemade distributed more Wemix tokens than disclosed in its plan. It also alleges inaccurate information was conveyed to investors via the company’s blog posts and disclosures. Wemade has since released a statement to vindicate itself, mentioning that efforts were made to rectify errors, and it submitted the required data.
The DAXA announcement triggered a massive dip of 75% in Wemix token prices, with the coin currently valued at $0.42. This was accompanied by a 30% drop in Wemade’s stock price. Additionally, Wemix tokens were tagged with a risk alert on other trading platforms, such as Bybit.
DAXA consists of five exchanges, Upbit, Bithumb, Coinone, Korbit and Gopax. It was formed by the cryptocurrency exchanges in response to the Terra/LUNA collapse earlier this year, with Terra Labs based in Korea. The crypto exchange association is acting as a self-regulatory body in the absence of legislation on these topics. One of Wemade’s contentions is that the DAXA process was not sufficiently clear.
Famous for its “Legend of Mir” series, Wemade launched the “DRACO coin” in the game MIR4 in August 2021 and also made its characters tradeable as NFTs – an indication of the company’s commitment towards gaming on the blockchain.