Binance, the world’s largest crypto exchange, has made a major move by acquiring a significant equity position in the South Korean cryptocurrency exchange GOPAX. It marks Binance’s return to the Korean crypto market after it exited two years ago due to low usage and volume, as reported by Bloomberg.
However, this GOPAX acquisition was funded through the largest exchange’s Industry Recovery Initiative, a co-investment project led by Binance, which has pledged $1 billion. No terms of the deal have been disclosed.
Yibo Ling, Binance’s chief business officer, stated that the firm’s investment in GOPAX was “meaningful” and aimed to support customers and ensure they could withdraw their assets. GOPAX had suspended withdrawals from certain products in November.
According to Ling’s 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.
Binance & The Korean Crypto Industry
South Korea’s crypto market was heavily impacted by the crypto rout of last year and the failure of TerraUSD, a local algorithmic stablecoin ecosystem. As a result, many Korean investors suffered losses, and its founder, Do Kwon, is now a fugitive.
Binance’s acquisition of GOPAX is an attempt to rebuild the Korean crypto and blockchain industry. Changpeng Zhao, Binance’s founder and CEO expressed hope that the move will help revive the market.
In addition to acquiring the majority stake in GOPAX, Binance plans to inject capital into the exchange to allow for customer withdrawals and interest payments for GOPAX’s yield product, GoFi.
Binance was hit by outflows last year due to the market slump and the collapse of rival FTX. However, this year’s rebound in token prices has stabilized market sentiment. The exchange recently expanded its footprint in Asia with the purchase of Sakura Exchange BitCoin in Japan.
With its investment in GOPAX, the Korean crypto market may see new growth in the coming months. It will be interesting to see how this acquisition impacts the wider crypto industry in the future.
However, this acquisition of GOPAX shows the company’s commitment to supporting the crypto industry and restoring confidence in markets, particularly in South Korea. The move is a positive step towards rebuilding the Korean crypto and blockchain industry.
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