Binance Returns to South Korea to ‘Rebuild’ the Local Crypto Industry (Report)

The world’s largest cryptocurrency exchange – Binance – reportedly restored operations on the South Korean market after acquiring a majority stake in the distressed local platform Gopax.  

It halted operations in the Asian country in 2021, citing low interest and usage among local traders.

Back in South Korea

Binance revealed its intentions to purchase a 41.2% stake in one of the leading crypto trading venues in South Korea – Gopax – and thus re-enter the domestic market last month. The bear market battered the activities of the latter, which halted withdrawals for certain products in November last year. Moreover, Gopax’s parent company – Streami Inc. – was among the largest creditors of the bankrupt lender Genesis. 

As reported by Bloomberg, Binance has completed the acquisition by taking a “meaningful” equity position in the Korean exchange. The financing was secured via a $1 billion Industry Recovery Initiative, which Binance co-led with other investors a few months ago. However, the exact terms of the agreement remain unknown.

Yibo Ling – Chief Business Officer at Binance – said the main goal of the deal is to establish a “fundamental thrust” among local users and “make sure that any customers who want to withdraw their assets have the ability to do so.”

CEO Changpeng Zhao (CZ) raised hopes that Binance’s return to the East Asian country will “rebuild the Korean crypto and blockchain industry.”

Both South Korea and Binance went through a turbulent 2022. The country was in the spotlight when Terra’s collapse sent shock waves through the entire cryptocurrency sector. The project’s algorithmic stablecoin – UST – and its native coin – LUNA – crashed to virtually zero, causing severe losses for investors.

Terra’s Co-Founder – Do Kwon (considered by some to be the main culprit behind the catastrophe) – was reluctant to cooperate with the authorities and regulators and left his homeland. While Interpol issued a red notice on the 31-year-old, his whereabouts remain a mystery. Recent sources indicated he could be hiding in Serbia. 

Binance’s most challenging times came in December (several weeks after the demise of FTX). Many crypto participants lost their trust in centralized exchanges and started withdrawing funds en mass. At one point, daily withdrawals from Binance surpassed $8 billion.

Nonetheless, the platform coped with the requests, while CZ assured that his company could serve as a stable custodian. He also claimed the massive wave of withdrawals resulted from a FUD.

Binance to Re-Enter Japan, too

The platform sought a permit to return to the Japanese market in September 2022 after staying away from it for four years. 

It strengthened its presence in the “Land of the Rising Sun” by purchasing the Sakura Exchange BitCoin (SEBC) two months later. Takeshi Chino – General Manager of Binance Japan – commented:

“We will actively work with regulators to develop our combined exchange in a compliant way for local users. We are eager to help Japan take a leading role in crypto.”