Binance is nearing a deal with Megazone to slash its stake in Gopax from 72.6% to about 10%.
Binance’s stake reduction in Gopax aims to bolster governance in compliance with local regulatory mandates.
The world’s largest crypto exchange, Binance, is reportedly finalizing negotiations with Megazone, a South Korean cloud service provider, to sell its ownership stake in Gopax.
According to the South Korean local news report, this move is part of Binance’s strategy to enhance its governance structure in response to regulatory requirements from local financial authorities. The exchange, originally acquired by Binance in early 2023 as part of its re-entry into the Korean market, saw its ownership stake increase to 72.6% at the time of acquisition.
Now, Binance plans to reduce this stake to around 10%. The sale comes at the time of Gopax’s upcoming renewal of its real-name account contract with Jeonbuk Bank, scheduled for August. Further, this strategic shift underscores Binance’s efforts to navigate regulatory views. It also reflects adjustments in its market presence in South Korea following earlier operational changes in 2021.
Impact of the FTX Collapse on Gopax
The collapse of Sam Bankman-Fried’s FTX crypto exchange in November 2022 had widespread fallout across the crypto industry, Gopax is such one. Shortly after FTX’s collapse, Gopax had to suspend withdrawals of principal and interest payments from its decentralized finance services. These services included products from Genesis Global Capital, a crypto lending firm that had filed for bankruptcy.
Before Genesis Global Capital’s bankruptcy, its parent company, Digital Currency Group, held a significant stake in Gopax. That was a crucial business partner, offering its GoFi product through the exchange.
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