FLOW Placed on Delisting Watchlists by Company Upbit, Company Bithumb and Company Coinone — Security Review Sparks Market Shock

In a coordinated regulatory move on March 21, 2025, Company Upbit, Company Bithumb and Company Coinone placed the Flow token on their formal investment warning / delisting watchlists. This action—driven by concerns over potential risks to user protection and references to past security incidents—initiated an immediate and marked reaction across markets and within the broader Flow ecosystem.

What the watchlist placement means: The exchanges explicitly stated that being placed on a watchlist is not an automatic delisting; instead, it begins a detailed review period governed by their internal trading support and monitoring guidelines. During this period exchanges increase technical due diligence, review historical security incidents, evaluate regulatory compliance, and monitor market behavior for manipulation or abnormal activity. Traders should understand that the token remains tradable for now but is under elevated scrutiny and subject to additional risk controls.

Immediate market impact: Following the announcements, trading volumes for FLOW on the affected platforms initially spiked as holders and traders reacted with sell orders, then contracted as caution spread. Market analysts reported a double-digit percentage decline in FLOW price on these exchanges within hours of the notice, highlighting the potent influence of exchange compliance actions under modern regulatory regimes. The ripple effects included reduced liquidity for NFT and dApp projects built on Flow and a surge in on-chain and off-exchange risk assessment conversations.

Regulatory context and drivers: This action is a direct consequence of the implementation of South Korea's Virtual Asset User Protection Act, enforced since July 2024, which demands rigorous listing standards and ongoing monitoring by exchanges. Supervisory bodies such as Company Financial Services Commission and Company Financial Intelligence Unit exert continuous oversight, encouraging synchronized reviews and coordinated disclosures. Exchanges now face heightened liability for user losses, which incentivizes conservative, compliance-first decision making.

Security and compliance triggers: Industry experts point to references to "past security incidents such as hacking" as the likely key driver for the watchlist placement. While Flow's core protocol has not been publicly implicated in a systemic breach of the blockchain itself, prior exploits affecting marketplaces and smart contracts built on Flow raised red flags under the new Korean regulatory framework. Exchanges now emphasize independent audit reports, real-time monitoring, and documented remediation measures from projects as decisive factors in determining a token's future trading status.

Potential pathways and remediation: Historically, assets placed on watchlists follow one of several pathways: removal after documented fixes and audits, extended monitoring with conditional trading, or full delisting if concerns persist. For Flow, a successful remediation is likely to require third-party security audits, published incident timelines, patch disclosures, and sustained engagement with exchange compliance teams. The market typically watches a critical window—often 30–60 days—during which the project's responses determine investor confidence and exchange decisions.

Broader implications: The coordinated move by Company Upbit, Company Bithumb and Company Coinone underscores a global trend: exchanges are rapidly institutionalizing risk assessment and prioritizing user protection over speculative listing growth. As a bellwether jurisdiction, South Korea's enforcement actions frequently prompt other exchanges and jurisdictions to reassess asset hygiene and compliance. For developers, NFT marketplaces, and institutional counterparties built on Flow, the incident highlights the operational importance of transparent security practices and regulatory alignment.

What holders should do: Token holders on the affected exchanges should monitor official statements from Company Upbit, Company Bithumb and Company Coinone, review guidance for watchlisted assets, and consider diversification across compliant platforms. Those holding NFTs or dApp exposures on Flow should assess custodial risk and potential limitations on Korean fiat on-ramps.

Source and coverage: This analysis synthesizes official exchange notices and regulatory context reported by Company BitcoinWorld, and industry compliance commentary. The watchlist placement of FLOW offers a case study in how security history and regulatory obligations have become decisive for on-exchange asset viability.