DRIFT Up 90% on Upbit Listing - Why is the South Korean Exchange So Important?
Korean Exchange listings have a bigger impact on price than rival exchanges. Why is an UpBit listing such a big deal?
$DRIFT, the native token of the Drift Protocol perpetual exchange, is the latest crypto token to reap the benefits of the fabled ‘Upbit Effect’.
Following its listing on the popular South Korean crypto exchange, $DRIFT exploded in value, continuing Upbit’s impressive track record.
Why do Upbit listings consistently cause bullish price movement and what coins might traders expect to see listed next?
$DRIFT Listed on Korean Exchange
On November 8, Drift Protocol, Solana’s second-largest perpetual exchange, expanded into South Korean markets. Upon its listing on Upbit, the nation’s largest crypto exchange, $DRIFT surged by over 90% to secure a new all-time high of $0.97.
$DRIFT’s sudden Upbit listing comes off the back of one of the biggest weeks in the project’s history. According to Drift co-founder Cindy Leow, Drift Protocol enjoyed improved revenues, TVL, and market resolutions during what can only be called a dramatic week for the cryptocurrency industry.
Upbit's listing appears to have inspired rival exchanges to action, with Binance opting to list $DRIFT in its perpetual trading markets.
However, a significant price surge following an Upbit listing isn't a privilege reserved solely for Drift Protocol. The South Korean exchange is historically an excellent catalyst for price discovery, leading the wider crypto community to coin a new term: The ‘Upbit Effect’.
The ‘Upbit Effect’
Centralized exchange listings have long been considered a bullish catalyst for crypto assets. Traders and investors widely believe that coins getting listed on platforms like Binance and Coinbase invariably makes them more accessible to a far wider audience.
However, recent years have dispelled these theories. A September SolanaFloor study found that 76% of Solana Ecosystem tokens listed on popular exchanges were trading lower than their listing prices, suggesting that exchange listings might actually be considered a ‘sell-the-news’ event.
While the likes of Binance and Coinbase are plagued by underwhelming token performances after listings, Upbit goes against the grain.
According to WuBlockchain, the South Korean exchange typically causes some of the most consistently impressive listing performances in the industry.
Social media commentators theorize the ‘Upbit Effect’ is due to South Korea’s strict crypto regulation laws. In the wake of the Terra Luna implosion and the catastrophic FTX exchange collapse, South Korea implemented the stringent Virtual Asset User Protection Act, which requires exchanges to safeguard 80% of user deposits in cold storage separate from the exchange’s funds.
Upbit Boasts Highest Spot Listing Win Rate
Beyond listing day pumps, Upbit statistically boasts the industry’s best spot win rate among leading crypto exchanges.
According to Scope Protocol, an AI Data Layer, Upbit spot listings have performed better than rival exchanges throughout 2024, despite maintaining a win rate of only ~35%.
Upbit’s decision to list $DRIFT suggests that the exchange may be turning its attention to Solana ecosystem tokens. The exchange has already made headways into the Solana ecosystem, listing memecoins like $MEW and $BONK earlier this year.
With Solana widely considered the Layer-1 to watch this cycle, Solana ecosystem tokens like $DRIFT are likely to witness further centralized exchange listings.
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