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| A Coinone's ad for KLAY listing / Courtesy of Coinone |
By Park Jae-hyuk
Kakao's blockchain subsidiary Ground X is expressing displeasure over domestic cryptocurrency exchanges choosing to list KLAY, a token issued via Kakao's Klaytn blockchain project, according to industry officials, Thursday.
While the Kakao subsidiary criticized the exchanges for the decision, they refuted the criticism, saying anyone can conduct business with the token as it has been issued as a "public blockchain."
This controversy first arose when mid-tier cryptocurrency exchange GDAC announced in May it would be the first exchange to list KLAY on the Korean won-based market.
Given that Ground X did not plan to list KLAY here, as the financial authorities have a negative view of virtual assets, the blockchain company terminated its business relationship with GDAC.
However, another mid-sized exchange Daybit and one of the country's major exchanges Coinone also listed KLAY without Ground X's agreement.
Ground X also ended its relationship with them in response.
According to industry officials, the cryptocurrency exchanges are motivated to list KLAY, because they can earn certain amounts of commission whenever Kakao's cryptocurrency is traded via their platforms.
For domestic exchanges suffering financial difficulties after the end of the bitcoin craze, the cryptocurrency developed by the nation's largest mobile platform operator is a lucrative business opportunity.
Ground X, in contrast, has been concerned about KLAY being regarded as a tool for speculation, because it may face stricter financial regulations.
"We seek to keep in step with the direction of the government's policy," the company said in a statement. "For the domestic listing of KLAY, we will closely work with the local regulatory authorities to ensure we are complying with relevant rules and regulations that are set to be introduced."
In response, the exchanges condemned Ground X, saying it was going against the technical characteristic of public blockchain and the spirit of decentralization.
"Public blockchain is also called permission-less blockchain that anyone can access and anyone can use," Coinone CEO Cha Myung-hun wrote on Facebook. "If Ground X wanted to prevent others from dealing with its blockchain, it should have developed the token as a private blockchain."
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