Bithumb Designates Velo Protocol's VELO as Investment Cautionary Cryptocurrency

Bithumb, South Korea’s largest cryptocurrency exchange, has designated Velo Protocol’s VELO token as an investment cautionary cryptocurrency effective February 22, 2023. The exchange cited lack of transparency into Velo’s business activities and failure to comply with previous improvement requests as reasons for the designation.

Deposits of VELO will be suspended starting at 4PM KST on February 22. Bithumb will decide whether to extend the cautionary designation in early March. During the designation period, Velo Protocol will have the opportunity to resolve the cited issues and request removal of the cautionary status.

Bithumb instituted its investment cautionary designation policy to protect investors by providing warnings about potentially concerning cryptocurrencies offered on its platform. Cryptocurrencies can be designated cautionary for reasons including lack of transparency, rumors of misconduct, technical vulnerabilities, and regulatory noncompliance.

According to Bithumb’s notice, the exchange has been unable to verify details of Velo’s business activities and development progress. Additionally, Velo allegedly failed to comply with all provisions of a previous improvement request. Bithumb now considers additional investor protections necessary.

Velo Protocol, developed by Velo Labs, issues VELO tokens on the Stellar blockchain. The Velo Protocol ecosystem aims to facilitate fast, affordable, and secure transactions. The protocol connects traditional financial partners and cryptocurrency providers to enhance liquidity and interoperability.

Bithumb stated its commitment to sustainable and systematic oversight of listed cryptocurrencies. The exchange aims to provide a sound trading environment through open communication and coordination with external experts and project foundations.

Image source: Shutterstock