Major cryptocurrency exchange Binance returns to South Korea with a new acquisition of local cryptocurrency exchange Gopax.
Binance has acquired a majority stake in Gopax backed by Digital Currency Group, returning to South Korea after exiting the market two years ago, and the company officially announced on February 3. Funding for the transaction came from an investment project initiated by the fund known as the Industry Recovery Initiative, for which Binance has pledged $1 billion.
Binance CEO Changpeng Zhao pointed out that Binance is responsible for protecting not only crypto users, but also the crypto industry. The Industry Recovery Initiative was created to support promising companies that have been negatively affected by the events of the past year. We hope that taking this step together with GOPAX will further rebuild the Korean crypto and blockchain industry.”
Binance’s chief business officer Yibo Ling reportedly indicated that Binance had acquired a “meaningful” equity position in Gopax, without disclosing the terms of the deal. Previous reports indicated that Binance bought a 41% stake from Gopax’s largest shareholder, Lee Jun-hang, while the deal was originally scheduled to be announced last year.
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The acquisition comes just months after Gopax halted recalls of certain products in November 2022 amid the FTX stock market crash.
Gopax has halted withdrawals of capital and interest payments on its decentralized finance (DeFi) service GoFi as a result of issues with now-bankrupt crypto-lending company Genesis Global Capital. Prior to bankruptcy, Genesis was Gopax’s second largest shareholder and major business partner, providing the GoFi product.
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With the acquisition, Binance plans to spend the new capital on the Gopax exchange for customer withdrawals and interest payments for GoFi. The initiative also aims to promote cryptocurrency education and close cooperation with South Korean regulators and virtual asset holders.
“The primary drive for this transaction was to support customers and ensure that any customers who wish to withdraw their assets have the ability to do so,” Ling stated.
