Upbit and Bithumb Halt SNX Deposits After Caution Flag from DAXA

Highlights:

• Upbit and Bithumb stopped SNX deposits after DAXA raised concerns about risks linked to the token.
• sUSD dropped below its peg, and this raised more pressure on Synthetix to fix its stablecoin issues.
• Korbit and Coinone warned users about SNX as the token price and its use as collateral faced trouble.

Upbit and Bithumb have both stopped accepting deposits for Synthetix (SNX) tokens after the Digital Asset Exchange Alliance (DAXA) marked the asset as a cautionary item. The decision came after an internal review by DAXA indicated potential risks associated with SNX and its association with the Synthetix USD (sUSD) stablecoin. An evaluation is in process to decide whether to keep on trading or stop trading on this asset.

🚨 South Korean exchanges Upbit and Bithumb have suspended Synthetix (SNX) token deposits due to potential risks flagged by DAXA. This move highlights the importance of investor caution as they assess the volatility around sUSD. Stay informed! 📉 #Crypto #Synthetix #MercexNews

— Mercex (@mercex_io) April 24, 2025

Upbit suspended deposits of the SNX token. In addition, it added a warning label to the token. The exchange explained that its decision came after it observed issues related to sUSD losing its dollar peg. The linkage of SNX as collateral for sUSD amplifies worries about market volatility. The platform warned that if the conditions remain unstable around the asset, investors could lose it.

It also explained that it scrutinized the usage of SNX and discovered it had a limited amount of use cases. The exchange confirmed that it will conduct a full review before deciding whether to lift the suspension or remove the token from its platform.

Bithumb also stopped deposits and tagged the token with a caution label. The exchange mentioned that it would monitor developments and might reverse the decision if the underlying concerns are resolved. Both exchanges made it clear that the safety of their users remained a top priority while assessing the situation.

sUSD Compared to UST as Value Drops Sharply

Concerns over Synthetix increased when its stablecoin sUSD dropped well below the $1 mark. sUSD fell to $0.83 at the start of the month, while SNX declined by 26%. The drop has raised more alarms about the protocol’s financial structure.

Rob Schmitt, co-founder of the Cork Protocol, earlier drew comparisons between sUSD and Terra USD (UST), which failed in 2022. However, he pointed out that sUSD’s debt system might be easier to manage. Still, the fall in value added to the urgency among Synthetix developers to stabilize the ecosystem.

sUSD, the algorithmic stablecoin underpinning the @synthetix_io markets, backed by SNX, is experiencing a significant and sustained depeg. Why did it depeg and is this the start of a death spiral or will it repeg? Let’s dive in!

What is sUSD?
To understand sUSD, we must first… pic.twitter.com/Gq4Q7SX904

— Robdog 🍾 (@robdogeth) April 1, 2025

On April 21, Synthetix founder Kain Warwick urged SNX stakers to adopt a new staking model that aims to restore sUSD’s peg. He warned that if stakers did not act quickly, the team might apply more pressure.

Other Exchanges Issue Warnings as SNX Price Slides

Korbit and Coinone have also issued investor alerts. SNX was also tagged with cautions from both exchanges, warning users to use caution while trading the token. The alert came as the asset continues to trade on the downtrend.

SNX is trading at $0.6980 with a total market cap of $236.96 million. In contrast, sUSD has shown mixed results recently. After dipping earlier in the month, it rose 9.4% in the past week but is currently trading at $0.8688, which is below the expected $1 value.

Exchanges stated that further reviews would take place in the coming weeks to decide the next steps. If conditions do not improve, trading support for SNX might be reconsidered.