KAVA and WAVES have been removed from their designation as warning items by members of the Digital Asset Exchange Association (DAXA). DAXA member companies collaboratively take measures such as urging investment caution, designating cautionary items, and terminating transaction support based on the risk index for each virtual asset type, aiming to protect investors.
While monitoring KAVA and its related stablecoin USDX, cryptocurrency exchange platform Upbit discovered that USDX was not consistently pegged to a fixed 1-dollar value. Consequently, on November 3, 2022, DAXA collectively designated KAVA as a cautionary item. Similarly, Upbit found that WAVES and its related stablecoin, USDN, were not regularly connected to a $1 value, prompting DAXA to jointly discuss WAVES and designate it as a cautionary item on December 8, 2022.
Today, among the risk indications for each virtual asset type risk disclosed by DAXA, the standard for stablecoin and stablecoin-related indicators states that when the ratio of stablecoin collateral of linked assets is less than 10% of the total collateral amount, the risk index for KAVA and WAVES should be marked. However, the reason for designating KAVA and WAVES as cautionary items has been resolved.
Nevertheless, in the future, depending on the application of the criteria for stablecoin and stablecoin-related asset risk indicators, KAVA and WAVES may be designated again as cautionary items, and end-of-transaction support may be reconsidered, according to the exchange.
The Waves ecosystem has faced challenges as USDN, once dubbed a “stablecoin,” has experienced a significant decline. Shortly after this development, Sasha Ivanov, the founder of the public chain project Waves, released a statement clarifying USDN’s future. Ivanov admitted that although the stablecoin has failed as a stable currency, it is not “dead.” Moreover, he elaborated that Waves tokens must be withdrawn from the centralized exchange and that the Power token airdrop would occur solely on the Waves chain.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Cryptocurrency investment remains a highly volatile and risky endeavor, and caution is always advised for investors. With KAVA and WAVES, the situation demonstrates the importance of market monitoring and evaluation to ensure the protection of investors. Constant monitoring and swift response by organizations like DAXA and Upbit can help prevent additional risk and potential significant losses for investors.
It is crucial for investors to remain informed about the status of cryptocurrencies and related assets, as their values can fluctuate rapidly. Organizations like DAXA strive to supply accurate information and provide appropriate measures to safeguard investors. In the case of KAVA and WAVES, the effective response of Upbit and DAXA helped mitigate risk and protect investors from possible issues arising from unstable coins.
With the rapidly changing landscape of cryptocurrency and digital assets, investors must stay vigilant and be prepared for fluctuations in value and potential risk. The recent events with KAVA and WAVES serve as a reminder that even seemingly stable coins can face challenges, and investors should always exercise caution and stay informed.
