The Korean exchange had previously delisting the ZXG asset.
The small-scale, relatively new Zeniex exchange ceased operations after discontinuing the ZXG token. The exchange decided to close shop, citing regulatory hurdles. Zeniex issued Ethereum (ETH) compensation on November 12, which was also the deadline to withdraw other coins and tokens on the exchange.
Zeniex was a small-scale exchange, but its withdrawal from the markets underlines two trends – namely lower demand for cryptocurrency speculation in South Korea as well as stricter regulations on issuing tokens. A Korean trader pointed out that the entire market has suffered a slowdown:
I’m Korean. Zeniex is very small exchange. Now, Bithumb and Upbit have also low volume. Korea is no longer a notable market.
— 서정석 (@seogree1010) November 19, 2018
The ZXG token was supposed to have acted as a source of liquidity and a way to redistribute exchange revenues, but like other utility tokens, was met with regulatory scrutiny on potentially issuing an unregistered security.
The Zeniex investment fund, related to the exchange, also failed to register with the South Korean Financial Services Commission, and this made its activity illegal. Zeniex was a joint venture of Korean and Chinese investors, aimed at exploiting the potential of cryptocurrency markets.
In addition to an exchange, Zeniex attempted to create a cryptocurrency investment fund – a move that was met with more serious regulatory hurdles.
The launch of the ZXG asset may still happen on foreign exchanges, although as a way to raise funds, and not as a token to access the crypto investment fund. For now, Zeniex has not shared any future plans for development. The ZXG token has been returned to just three addresses, holding a total of 20 million tokens.
The closing of the Zeniex exchange is occurring during one of the crypto market’s steepest crashes and assets across the board are falling to new yearly lows.
Genesis Capital, the Chinese partner of the Zeniex team, has been related to large crypto-lending projects based on the Ethereum ecosystem. The fund has moved away from active publicity as the bear market rolled on. Startups have been hurt by falling ETH market prices, which after the most recent shakedown fell as low as $155.43, thus severely restricting the possibility to liquidate the crypto funds profitably.