Recently, major centralized exchanges (CEXs) have begun launching their own blockchains, creating new growth scenarios. Major South Korean exchanges like Upbit and Bithumb may embark on this path. This article explores potential scenarios and current challenges for these CEXs.
Beginning of CEX Infrastructure Competition
Centralized exchanges (CEXs) are starting to compete to create blockchain infrastructure. Platforms like Coinbase and Kraken have already launched their own projects. This competition is driven by limitations in fee-dependent business models and the need for revenue diversification. A narrowing market and the rise of decentralized exchanges necessitate CEXs' quest for new opportunities.
Scenarios for Upbit and Bithumb Blockchain Launch
Various scenarios may be implemented by Upbit and Bithumb should they launch their own blockchains. Potential options include: creating Layer 2-based infrastructure, implementing Korean won stablecoin systems, leveraging liquidity strategies, and entering the pre-IPO stock tokenization market. Each scenario reflects the unique conditions of the Korean market.
Final Thoughts
In conclusion, the launch of their own blockchains by Upbit and Bithumb represents a promising strategy but faces several regulatory and technical hurdles. Nonetheless, given the decline in trading volumes and increasing global competition, this could be a necessary step for adaptation and growth. A more open and supportive regulatory environment may facilitate the realization of these plans.
The projects of Upbit and Bithumb in the blockchain sphere could represent an important step for the development of the Korean crypto market, although many challenges remain to be addressed for these plans to become a reality.
