Korea’s recent attempt to find the next BNB

And a quick lesson of Korean

Published in

ICO of KOREA

7 min readAug 23, 2018

The bear market. Yes, that is what we all are going through at this moment. However, just because it is a bear market does not mean investors will be losing their money most of the time. In this market there are still the occasional pumps, which really is why a lot of us love crypto in the beginning. So what is happening in Korea? Recently some local exchanges have created their own tokens. This is not new, considering the popularity of exchange-based tokens like BNB(Binance), HT(Huobi), BIX(Bibox), FT(Fcoin) etc. In Korea, however, this concept was (and still is) pretty new. There has been a lot of attention (TOO much attention actually) on some local exchanges and their new tokens. Let us have a look.

The story behind cryptocurrency exchange’s native tokens

When asked about exchange-based tokens the usual investor would think of Binance and its native token BNB. Famous for its 12,000% increase since its ICO, it is also ranked 16th on CoinMarketCap at the time of writing. The reason why BNB is so popular is related to Binance’s efforts to constantly increase its price (discount on transaction fees, using profits to destroy BNB, community votes etc). These features overall have given investors the impression that exchange-based coins are “relatively” safer than the numerous, highly volatile coins that are in the market. Other coins such as Huobi’s HT, Bibox’s BIX, and recently FCoin’s FT have hopped on to the hype (also showing some positive results). I have only mentioned 4 exchanges so far, you probably know the next story.

To the normal investor, there is the bull market and the bear market. When there is a bull market, investors buy. When there is a bear market, investors sell (technically either market there is always buying and selling but let me simplify). How about cryptocurrency exchanges? To exchanges, when someone buys they get transaction fees, when someone sells they get transaction fees. Exchanges have a constant revenue model from these fees, but what if those revenues were redistributed to the users? Especially the users that are holding our native tokens?

Welcome to Korea: Ga-doo-ri Meta, 가두리 메타

A popular term among Koreans is the word “Meta, 메타”. Originated from gamers, Meta stands for Most Effective Tactic Available. Simply speaking, it is a form of slang that points out to a certain type of behavior. For example, in crypto there is shilling. In Korean we say 선동 메타 (Sun-dong Meta), which means there is shilling going on. Then what is Ga-doo-ri Meta? It basically describes a situation in which investors are confined (voluntarily and involuntarily) to a certain exchange for trading. The word Ga-doo-ri is a term related to “confinement”. Recently I have noticed a lot of people saying that in this type of market it is better to engage in Ga-doo-ri Meta rather than investing in major coins such as BTC and ETH. So how does this “Meta” work? Here are two examples.

Ga-doo-ri Meta also on Player Unknown’s Battlegrounds

Ga-doo-ri Meta #1: CoinZest and its native coin COZ

CoinZest is a new exchange in Korea. It launched in June. It passed Bithumb in trading volume in August (according to Coinhills). What happened over the past 2 months? CoinZest launched its native coin “COZ” in July. Starting as a mere payback airdrop, it was first priced around 500 KRW (=$0.45). Here are some details.

COZ: CoinZest’s Exchange point system for user’s profit realization

Name: COZ
Type: ERC20
Total Supply: 300,000,000 COZ
Available for Mining: 120,000,000 COZ (For 3 years)
Consensus Algorithm: PoS + PoT (Proof of Trading)

Then CoinZest announced 70% of its revenues from transaction fees will be distributed to the users holding COZ in either BTC or ETH (not to mention the mining rewards). Suddenly people became very interested and started to accumulate COZ. In the beginning COZ fell to 55 KRW (=$0.049). At the time of writing COZ is valued at 1785KRW (=$1.59), which is an increase of 32.45x.

Prior to this nobody even mentioned CoinZest. Now everybody is saying how they bought at 200KRW (=$0.18) and only sold at 600KRW (=$0.54). In a market where a “+” sign is not common anymore, people are complaining about “3x”. To this day COZ is increasing around the range of 20–30%, and CoinZest announced a few days ago that it will continue this profit redistribution system until the end of 2018. Here is the profit share equation.

Profit reward amount = % of COZ held daily X CoinZest’s daily profit
(% of COZ held = # of COZ tokens / Circulating COZ Supply X 100)

Can CoinZest keep up with the hype? Can COZ sustain the price and increase even more? Stay tuned in my telegram (just as I wrote this part COZ again increased by 30%).

Ga-doo-ri Meta #2: Cashierest and its CAP token

Some of you might be familiar with Cashierest because of the recent listing of Holo. It came across a shock to me when people were reacting to it as “Holo just got listed on Korea’s 3rd biggest exchange”. Cashierest to me cannot be categorized as one of the “top” exchanges. It is only famous for pumping certain coins, but that is enough to some in this bear market. It recently stopped deposit/withdrawal for maintenance (you can still trade). As a result, there are some very unusual prices on the exchange. For example, Zilliqa is valued at 333 KRW (=$0.30, 8.11x CMC price), Holo is valued at 1.42 KRW (=$0.0013, 2.17x CMC price), and Omisego is valued at 24,000 KRW (=$21.45, 5.5x) at the time of writing. True Ga-doo-ri, aka confinement right there.

Then came the announcement, or in a way the ICO, of CAP (its native coin). Many people were complaining about how they missed out on COZ, then with the appearance of CAP, there was new hope. Here are the details of CAP.

Name: CAP
Total Supply: 500,000,000,000
Token Price: 0.1 KRW (=$0.000089)

Out of the total supply, 225,000,000,000 (45% of total supply) is available for trade-mining. Trade-mining is simply a fancy word to describe the payback of transaction fees (100% through trade mining, 70% through referral mining). To summarize, from August 22 00:00am to August 22 23:59pm 100% of transaction fees will be distributed as CAP to all users. What separated CAP from COZ was that it gave out KRW dividends based on the amount of CAP on hold. A snapshot will be done every 10th and 25th of each month, and the calculation of KRW dividends is as the following:

KRW Dividend amount = # CAP owned / Total CAP X Transaction Fee

This is clearly against the law, but people are still loving CAP. At the time of writing, Cashierest has a trading volume of 115,579 BTC, 6th in the world and 1st in Korea. CAP is the hot topic across most Korean crypto communities and right now CAP is priced at 0.6 KRW (=$0.00053), 6x the original price. With the previous popularity of COZ and KRW dividends (very dangerous), I do not think this hype will be reduced anytime sooner.

More Ga-doo-ri and a quick prediction

As I write this article I am coming across more exchanges engaging in this type of marketing activity. A few days ago Synco (if you want to know about them you can ask me here), launched its own exchange called CHAINB. It is the same pattern. You refer someone to CHAINB, you get Synco Coins. You trade on CHAINB, you get Synco Coins. 90% of transaction fee revenue, you get it all back as Synco Coins.

The usual: profit redistributed in Synco coin, referrals, transaction fee discount, airdrop, etc

Suddenly everyone is looking for the best Ga-doo-ri Meta they can engage in.

To hop on the meta, there is one exchange that I think will soon be releasing a native coin: Allbit. No insider information or anything, just a simple guess. Allbit is another recently formed exchange. Its investor is Dunamu, the same company that created Upbit (Korea’s top exchange). On its website you can see the word “APOT, Allbit Proof of Token”. So far there is no information on APOT, but the fact that there is the word “Token”, one can make a legitimate guess.

Final Remarks

Even in a bear market there always seems to be a way to make money. In this case, there is the Ga-doo-ri Meta. There are still a lot of people stuck in the exchanges actively trading the coins mentioned above. So far the general opinion is “I sold it too low”, but there also will be a point in which the general opinion is “I lost a lot”. When that moment comes (hoping it doesn’t), I will be back to tell you about it.