Apology for the Designation of Significant Cryptocurrency Assets on Bithumb and Coinone
Hello, this is Reapchain.
First of all, we sincerely apologize to all stakeholders, holders, users, and those who have shown interest in our project regarding the designation of notable items on Bithumb and Coinone exchanges.
The reasons for designating notable items are as follows, and Reapchain Foundation is currently submitting sufficient data to Bithumb and Coinone to clarify and address the issue.
[On Bithumb]: It has been observed that additional issuance has occurred contrary to the disclosed circulation plan due to the mainnet service, which is a major business of the Foundation, not operating normally. We are confirming information and measures for investor protection with the Foundation.
[On Coinone]: In the process of distributing the project team’s quantity determined through governance on January 6, 2024, discrepancies such as additional issuance and changes in quantity distribution contrary to the announced circulation plan have been confirmed. Therefore, Reapchain (REAP) is designated as a notable item in collaboration with DAXA, a member company.
The issue of additional issuance and distribution currently being raised is due to the generation of quantities without going through the bridge while opening the mainnet, leading to misunderstandings as stated above. The Reapchain mainnet operates with a structure where the Permanent Committee Operating Committee participates in consensus through staking, and the bridge was not open at the time of mainnet launch, so the Foundation’s holdings were generated at a 1:1 ratio for mainnet operation. The Permanent Committee holdings and Foundation holdings were managed in wallets on exchanges through lock-up and could not be further circulated on the Ethereum network, as they were matched 1:1 with the mainnet. We are providing explanations based on technical data.
Fifty percent of the Permanent Committee holdings, which have become an issue, were burnt on January 22, 2024, along with the scheduled token economy patch to prevent frequent hard forking of the mainnet. The reason for the delay in burning was to align with the scheduled mainnet patch and to prevent frequent hard forking. We want to reiterate that these quantities were structured in such a way that they could not be circulated externally and made every effort to manage them.
We will establish prevention measures to ensure that such issues do not recur and will announce each measure as it is completed.
Preventive measures:
1. Recruitment of blockchain compliance experts at a level equivalent to financial regulators to operate an internal monitoring system to prevent future harm to investors.
2. External custodial custody of foundation management quantities to manage foundation holdings more transparently and securely.
3. Patching wallet holder status by wallet address in the Reapchain blockchain explorer to allow investors to easily check their holdings.
4. Patching to enable verification of previous blocks even after hard forking through Genesis. This is already completed.
5. Company-wide education on mainnet operation and management.
Reapchain Foundation has been based in Korea and has focused solely on investment and technical development for several years, and now, through the launch of the mainnet, we are finally beginning to see the results of our efforts.
Once again, we deeply apologize for the initial inadequate response and the potential for misunderstanding regarding circulation volume during the mainnet launch. We pledge to ensure that such incidents do not happen again. The submission of explanatory materials requested by DAXA and exchanges has already been completed, and we will share the results as soon as they are available.
Thank you
