Binance is in early-stage discussions to reduce its stake in South Korean crypto exchange Gopax to resolve the latter's liquidity issues following the FTX collapse and local compliance concerns, according to local news outlet Dailian.
Gopax, one of five fully registered crypto exchanges in South Korea, was acquired by Binance in February 2023 after the exchange faced liquidity issues associated with the FTX-afflicted Genesis Global Capital. Binance stepped in to resolve Gopax’s liquidity issues under the condition of acquiring a 72.26% stake in the South Korean exchange.
Binance’s Asia-Pacific BD director, Steve Kim, said during a roundtable Tuesday that Binance plans to convert its loans made to Gopax into equity and then sell the shares to other firms, which will ease the debt issues within Gopax, according to local news agency News1. The plan will have Binance step down from largest shareholder to second-largest, Dailian reported.
Gopax announced last December that it is in the final stage of securing funds to normalize its deposits lost in Genesis. Moreover, the reviewed plan is expected to help Gopax renew its registration with the local regulator, the Financial Services Commission.
Following the Binance acquisition, Gopax applied to report its structural change in its virtual asset service provider registration with the FSC. However, the FSC has delayed approving the change in registration for over a year, under concerns with Binance’s legal issues in the United States.
Kim reportedly said in an online roundtable Tuesday that it will provide more details within two months. Binance did not immediately respond to The Block’s request for further comments.
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About Author
Danny Park is an East Asia reporter at The Block writing on topics including Web3 developments and crypto regulations in the region. He was formerly a reporter at Forkast.News, where he actively covered the downfall of Terra-Luna and FTX. Based in Seoul, Danny has previously produced written and video content for media companies in Korea, Hong Kong and China. He holds a Bachelor of Journalism and Business Marketing from the University of Hong Kong.
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Binance looks to reduce stake in South Korean crypto exchange Gopax: report - The Block
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