Binance Acquires Majority Stake in GOPAX, Re-Enters South Korean Market
- Acquiring a majority stake in the GOPAX crypto exchange will allow Binance to re-enter the South Korean market, two years after it left.
- The funds for the acquisition came from Binance’s Industry Recovery Initiative, and will be used to enable customer withdrawals and interest payments on GOPAX.
Binance CEO Changpeng Zhao. CoinDesk
Popular cryptocurrency exchange Binance is once again entering the South Korean market through the acquisition of local crypto exchange GOPAX, Bloomberg reported on 3 February.
According to the publication, Binance has now acquired a majority stake in South Korean crypto exchange GOPAX, which last November paused withdrawals for some of its products amid the collapse of the FTX exchange. Binance now plans to spend the new capital into GOPAX to enable customer withdrawals and interest payments for the exchange’s yield product GoFi. Binance’s chief business officer, Yibo Ling, said in a statement:
“The fundamental thrust of this deal was to support customers and make sure that any customers who want to withdraw their assets have the ability to do so.”
While the terms of the deal were not disclosed, Binance’s investment in GOPAX came from its Industry Recovery Initiative, which was created last year in response to the collapse of FTX, and to which Binance pledged $1 billion. The popular crypto exchange closed its affiliate in South Korea in December 2020, citing low usage of the platform, but acquiring a major stake in GOPAX will finaly see Binance re-enter the South Korean crypto market.
This is not the first time the exchange has re-entered an Asian market recently, with Binance acquiring a 100% stake in a licensed crypto service provider in Japan — Sakura Exchange BitCoin (SEBC) — in November 2022. Binance originally intended to establish a regional headquarters in Japan in 2018, but abandoned its plans after receiving a warning from the Japanese Financial Services Agency (FSA).
- One of the largest South Korean commercial banks, KEB Hana Bank, partnered with crypto custodian BitGo in order to set up a new crypto custody venture in the country.
- The new venture, which will use BitGo’s crypto security expertise and Hana’s experience in financial services and compliance, is expected to launch in the second half of 2024.
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- The company said it will be suspending its crypto-backed debit card service in the Middle East on 25 August, and in Latin America by 21 September.
- Although no reason was given for the decision, the company noted that “less than 1% of users” in those regions will be affected by the change.
- A spokesperson said the change was due to the “changing market and user needs”, and that Binance will now be refocusing its resources on its main products and long-term goals.
- Launched in March 2022, Binance Connect helped crypto businesses connect with the traditional finance system, and supported 50 cryptocurrencies and networks such as Visa and Mastercard.