- Binance bought 41.2% of crypto exchange GOPAX shares to return to South Korea.
- Binance announced that the investment was part of its Industry Recovery Initiative (IRI).
- GOPAX faced difficulties last November due to its ties with Genesis Global.
- An ultimatum from authorities led Binance to discontinue its trading pairs and payment options.
Cryptocurrency exchange Binance has ventured into South Korea again as part of its global expansion strategy. As per reports, Binance bought 41.2% of the shares in the South Korean cryptocurrency exchange GOPAX.
However, according to a recent announcement from Binance, the investment is a part of its Industry Recovery Initiative (IRI).
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Through our Industry Recovery Initiative, #Binance has invested in South Korean Crypto Exchange GOPAX.
We will work closely with GOPAX and South Korean regulators to boost user protection standards in the country as well as improve user education through @BinanceAcademy.
— Binance (@binance) February 3, 2023
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GOPAX experienced issues last November due to its ties with embattled trading service provider Genesis Global Capital, LLC. As a result, the Korea-based crypto exchange stopped withdrawing principal and interest payments in its platform, GOFI.
According to Binance CEO Changpeng Zhao (CZ), the IRI was designed to aid ‘promising companies’ impacted by last year’s events.
“The Industry Recovery Initiative was created to support promising companies that were negatively impacted by the events of last year,” Zhao stated. “We hope that taking this step with GOPAX will further rebuild the Korean crypto and blockchain industry.”
As reported, Binance will work closely with GOPAX to improve user education and blockchain awareness and cooperate with the South Korean regulators and virtual asset stakeholders to support the local ecosystem with Binance’s technology and liquidity.
Binance Entering South Korea for the First Time Since 2021
In late 2021, Binance discontinued its trading pairs and payment options in South Korea. It happened after the country’s Financial Intelligence Unit issued an ultimatum for the crypto exchange to register in line with new anti-money laundering laws or risk criminal charges. Binance claimed it was operating within the regulatory landscape in the country.
With the recent investment, Binance can return to South Korea to provide cryptocurrency services through GOPAX.
Binance has invested in various projects in addition to the recent acquisition. Recently, the exchange made a strategic investment in hardware wallet maker NGRAVE. According to Binance, it carried out the investment to enhance crypto self-custody. Last December, the firm invested in GoPlus, a security infrastructure firm, to foster a user-oriented security solution.
On the Flipside
- The GOPAX investment is part of Binance’s $1 billion Industry Recovery Initiative (IRI). To qualify for the initiative, organizations must demonstrate innovation and long-term value creation, have a clearly defined business model, and have a strong risk management plan.
Why You Should Care
According to a Korean news outlet, Gopax faced a deficit of $471 million from deposits in Genesis Trading as the firm suspended withdrawals last November because of the FTX collapse. However, it is expected that GOPAX will now be able to return to its normal operations and resume withdrawals and interest payments to its yield product users through this investment.
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