South Korean National Assembly to Probe Altcoin AVAIL ‘Price Manipulation’ Case

The South Korean National Assembly is set to investigate transactions involving the altcoin AVAIL on the crypto exchange Bithumb in July amid “price manipulation” suspicions.

Per Bloomingbit/Hanguk Kyungjae, lawmaker Min Byeong-deok, of the Democratic Party of Korea, will bring the case before an audit held by the Political Affairs Committee on October 17.

AVAIL Price Audit Begins

Min has labeled the token a “burger coin,” a variation on the moniker “kimchi coin.” Whereas the term kimchi coin refers to low-cap domestic altcoins, “burger coins” are tokens “issued overseas but listed on domestic crypto exchanges.“

Min was the first to coin the term at an audit last year. That audit focused on “circulation issues” connected with the SUI coin.

“October 17’s audit will let us address the recent controversy over AVAIL prices, as well as listing beam and manipulation suspicions on Bithumb, a platform that lists AVAIL.”

South Korean lawmaker Min Byeong-deok

The term “listing beam” refers to a phenomenon whereby the price of newly listed coins rises sharply immediately after listing before falling quickly.

The regulatory Financial Supervisory Service launched its own probe into the coin in early August after a flurry of suspicious transactions in late July.

The FSS thinks an unnamed investor bought “a large amount of AVAIL from overseas vendors” and then “led trading on Bithumb” on July 23.

💍 South Korea has made it possible for married couples to divide cryptocurrency holdings during divorce proceedings.#SouthKorea #Cryptohttps://t.co/jBqnrcwYf8

— Cryptonews.com (@cryptonews) October 10, 2024

The regulator thinks this trader drummed up support for their drive online and then tried to spike prices by executing scores of post-listing transactions.

This, the FSS believes, helped drive AVAIL prices up from around $0.17 to the $2.56 mark “in the space of around 15 minutes.”

Only AVAIL prices on Bithumb were affected, with the token’s prices remaining steady on rival exchange platforms.

Lawmaker Demands Data

Min has asked financial regulators to provide the commission with “relevant data” for its audit.

This data includes “the status of abnormal transactions of AVAIL coins listed on Bithumb.”

Many think the unnamed investor “sold Avail on behalf of non-Koreans who could not use domestic crypto exchanges.”

Min’s office said:

“The price manipulation […] issues connected with the Bithumb-AVAIL price incident are the joint responsibility of the exchanges and financial authorities. They are neglecting investor protection. We will hold them accountable.”

Min has previously criticized crypto exchanges for “ignoring” the “damages” investors suffer from “burger coin” price manipulation events.

South Korea’s current account recorded the biggest surplus in more than six years, boosted by global demand for chips used in AI https://t.co/BuFVsgt7OD

— Bloomberg (@business) August 7, 2024

The Financial Supervisory Service’s probe is still ongoing. The regulator said it would not “disclose information” until its probe was “fully resolved.”

“Any mention of the progress of the investigation could affect market prices.”

Financial Supervisory Service

Early Test for Virtual Asset User Protection Act

Bithumb, meanwhile, has also refused to comment on the investigation so long as it remains active. It said:

“We have a system in place to report to the financial authorities on abnormal transactions, based on monitoring, as per the terms of the Virtual Asset User Protection Act.”

The act came into force in July this year. It contains clauses pertaining to investor protection and anti-price manipulation measures.

An unnamed crypto industry insider told the media outlet the case would “serve as a useful precedent for the financial authorities and investigative authorities, regardless of its outcome.”