Upbit Temporarily Suspends NEAR Transactions Ahead of Network Upgrade
NEAR Transactions Suspension and Network Upgrade
Upbit, a prominent global cryptocurrency exchange, has announced the temporary suspension of deposit and withdrawal services for NEAR Protocol (NEAR) in preparation for an upcoming network upgrade. The suspension, set to take effect on August 26, 2024, aims to safeguard users' assets during the upgrade process. While trading of NEAR on the platform will continue smoothly, Upbit advises against making any deposits during this period to prevent any potential issues that may arise.
Recently, Upbit disclosed that the suspension of NEAR Protocol transactions is necessary as part of a planned network upgrade to enhance the blockchain's performance and security features. The suspension will commence at 12:00 KST on August 26, 2024, and will remain in place until the upgraded network is deemed stable.
The exchange has issued a cautionary notice to users, emphasizing that any deposits made after the suspension commences may not reflect in their Upbit accounts, and in some cases, the recovery of these funds could be challenging. During the suspension period, deposit and withdrawal processing will pause, with any backlog being addressed sequentially once services resume.
Despite the interruption in deposits and withdrawals, trading of NEAR tokens on Upbit will continue unaffected. Upbit assures users that they can engage in buying, selling, or exchanging NEAR tokens without any disruptions. Furthermore, the exchange guarantees a cooperative effort with the Near Protocol team to safeguard user assets during the network upgrade.
Upbit Regulatory Strom Amid Growth
Upbit's temporary suspension of NEAR transactions coincides with heightened scrutiny faced by South Korean cryptocurrency exchanges under the Virtual Asset User Protection Act (VAUPA) enforcement by the Financial Supervisory Service (FSS). Since the law came into effect on July 19, 2024, the FSS has implemented stringent monitoring to detect and address suspicious transactions across registered exchanges like Upbit.
Adherence to regulatory frameworks is crucial for Upbit as it operates within a tightly regulated environment prioritizing user asset protection. In a recent development, a South Korean court ruled in favor of a Vietnamese investor, ordering Dumamu, the operator of Upbit, to compensate the investor for a delayed transfer of Terra LUNA Classic (LUNC) coins leading to a significant loss during the Terra ecosystem crash in May 2022.
The court decision highlighted Upbit's need to be prepared for such scenarios and emphasized the unjustifiable delay in returning the investor's coins, along with the obligation to pay late payment interest. Additionally, concerns have been raised by South Korean lawmaker Min Byeong-deok regarding Upbit's growing market dominance, with the exchange controlling around 60% of the country's trading volumes as of July.
Although the market share had decreased significantly the previous year, lingering concerns remain over Upbit's substantial influence, particularly in conjunction with its banking partner, K Bank. The evolving regulatory landscape and ongoing legal battles underscore the challenges faced by cryptocurrency exchanges as they navigate regulatory compliance while striving to maintain user trust and operational stability.
