A takeover deal for the South Korean crypto exchange GOPAX has “practically fallen through,” casting doubt on its long-term survival . Chosun Ilbo reported that progress has stalled on a deal that would s ee Megazone, a cloud service provider, take control of GOPAX. The latter is one of South Korea’s five fiat-trading crypto exchanges. The deal is complicated by the fact that GOPAX is currently majority-owned by the global crypto exchange giant Binance . GOPAX: Takeover Deal in Danger? Binance bought a controlling stake in GOPAX in early 2023 as part of its bid to break into the high-volume South Korean market. GOPAX trading volumes over the past 12 months. (Source: CoinGecko) But South Korean financial regulators have blocked the move. They have ordered Binance to reduce the size of its stake in GOPAX from around 67% to 10%. The media outlet wrote that “crypto industry” insiders said on December 24 that “negotiations between Megazone and Binance” over the sale of GOPAX “have not progressed since October.” Ruling party nominates 5-term lawmaker Kwon to head emergency committee https://t.co/4h4jsPxwR4 — The Korea Times (@koreatimescokr) December 24, 2024 ‘Nothing Has Been Confirmed’ Chosun wrote that Megazone “stated that nothing has been confirmed regarding the acquisition discussions with GOPAX.” The company claimed that talks are “still in progress.” But it also suggested “there are currently no actual discussions or plans in place.” Chosun added: “Megazone and Binance have not spoken directly of late. And industry sources have come to the conclusion that Megazone has effectively given up on the acquisition deal.” A further wrinkle comes in the form of GOPAX’s debt to creditors as a result of the failure of its GOPAY crypto staking services. Binance has expressed its willingness to clear the debt with its own capital if it is allowed to complete the takeover. @Binance has solidified its position as the world’s leading cryptocurrency exchange, boasting $21.6 billion in customer deposits for 2024. #Binance #Bitcoin https://t.co/7sa3tc9GSh — Cryptonews.com (@cryptonews) December 13, 2024 Megazone: Buyer Getting Cold Feet? Megazone, meanwhile, had agreed a deal in principle to buy most of Binance’s shares. However, as most of the GOPAY debt is in the form of crypto, the task of satisfying creditors has become increasingly daunting. Bitcoin (BTC) prices have soared since the October talks, rising from just over $60,000 to an all-time high of above $106,000 in recent weeks. Bitcoin prices in 2024. (Source: CoinMarketCap) GOPAX’s GOPAY woes began in 2022, with the collapse of the FTX exchange. This caused Genesis, GOPAY’s partner, to declare bankruptcy, saddling GOPAX with the resulting debt. GOPAX has told creditors that it wants to repay unpaid balances “in cash based on the price at the time of the collapse.” But disgruntled creditors say they want their Bitcoin back “as-is.” Chosun wrote that if Megazone “pulls out of the deal, the exchange will not meet financial authorities’ demands. And it explained: “Not only is it extremely unlikely that a new buyer will emerge, but it is also obvious that Gopax’s debt will be a hindrance during takeover negotiations.” Did you know Korea has over 100,000 coffee shops for a population of just 51 million? For Gen Z Koreans, cafes aren't just for coffee. They're a lifestyle. Discover how these spaces are shaping culture for young Koreans. https://t.co/TElg378K2R #KoreanCulture #GenZ #CafeLife — The Korea Herald 코리아헤럴드 (@TheKoreaHerald) December 24, 2024 On-site Inspection GOPAX is one of only five domestic exchanges with a crypto-to-fiat trading permit. But its status may also be under threat. The exchange has applied for a renewal of its Virtual Asset Service Provider (VASP) registration recently, with regulators visiting for an on-site inspection last week. The firm received the all-clear, but the newspaper wrote: “If the authorities do not accept the renwal application, citing the change in major shareholders as a problem, GOPAX will have to go through the process of closing down. And then repaying its debts will become even more difficult.” Chosun quoted an unnamed industry insider as saying: “GOPAX has fulfilled all the legal requirements it could. And all that remains is gaining regulatory approval. Fortunately, Binance is still willing to repay GOPAX’s debts and is communicating with the authorities. So there is still hope.” The post South Korea’s GOPAX Exchange ‘in Trouble’ As Takeover Bid ‘Stalls’ appeared first on Cryptonews .
