The world’s largest cryptocurrency exchange, Binance, has always been used to making it to the headline most times for its new acquisition. Today’s news is no different as Binance is set to return to South Korea’s crypto market, given its stake in the troubled South Korea-based cryptocurrency exchange GOPAX.
Binance shut down its operations in South Korea in 2021 as a result of bothersome obstacles such as low usage and volumes from South Korean consumers. But its recent stale in GOPAX serves as Binance’s reappearance in the East Asia-based country.
Binance To Revive GOPAX?
Last November, the GOPAX exchange got into some financial trouble after bankrupt crypto lending firm Genesis refused to pay GOFI users. GOFI is a yield-generating product offered by GOPAX alongside collaboration with Genesis. The South Korea-based cryptocurrency exchange eventually suspended the withdrawal of principal and interest payments in the Defi service, GOFI.
Reportedly, the suspension was a result of Genesis Global Capital, which is the partner, shutting acquisitions and initiating new loans at its lending arm Genesis Global Trading. Genesis disclosed the GOFI withdrawal suspension citing abnormal withdrawal requests, just a week after the FTX crash.
GOPAX’s parent company Streami Inc. is part of the top 10 largest known creditors of the bankrupt crypto lender firm Genesis Global. According to a blog post by GOPAX, Genesis’s parent company, Digital Currency Group, is the second largest shareholder of GOPAX.
While the South Korean exchange is still very well in trouble, Binance chose to acquire it. Yibo Ling, the chief business officer at Binance, revealed that the company had taken a meaningful equity position in GOPAX. Notably, Binance purchased a stake in GOPAX from the Industry Recovery Initiative, which it founded late last year following the FTX collapse.
The company plans to infuse funds into GOPAX to allow customers to withdraw their interest payments in GOPAX’s yield product GoFi. Ling noted, “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.”
Flashback To Binance Shut Down In South Korea
In November 2021, Binance shut down operations in South Korea. The discontinued operations included Binance South Korean Won (KRW) trading pairs service, KRW payment options, P2P merchant applications, and Korean language website support.
As reported by Bitcoinist, the firm’s decision could be related to the notice from the South Korean Financial Intelligence Unit. Binance CEO Changpeng “CZ” Zhao noted in a statement that he hopes the move to return to South Korea through “GOPAX will further rebuild the Korean crypto and blockchain industry.”
While Binance continues to acquire and increase its investment in the crypto sector, the exchange’s native token BNB has demonstrated great potential. After surviving the ubiquitous FUD (fear, uncertainty, doubt) from the industry late last year, BNB is beginning to rebound.
Since the beginning of the year, BNB has surged over 30%, breaking above the $300 zone. Though the crypto asset has moved significantly in the past weeks, it is still down 52% from its all-time high of $686, seen in May 2021. At the time of writing, BNB trades at $325.95, down 1.2% in the last 24 hours.
Featured image from Shutterstock, Chart from TradingView