Per Chosun Ilbo, a local news media outlet, a spokesperson for Kolon’s honorary chairman, Lee Woong-yeol, revealed that the South Korean-based company has partnered with Binance to establish a digital asset exchange in South Korea.
Binance To Re-Enter South Korea With New Partnership
A spokesperson for the honorary chairman unveiled the collaboration between Binance and Kolon, affirming that the corporation is prepared to cooperate with financial regulators. Kolon, established in 1954, is a large corporation comprising over 28 subsidiaries and 40 entities in various countries.
The group of companies is involved in multiple industries, such as finance, fashion, and chemicals. Since 2020, Kolon has been active in crypto, investing in South Korean exchanges such as Dunamu.
According to reports, Chairman Lee has held numerous domestic and international digital currency representatives gatherings after stepping down from his leadership role in Kolon in 2018. When he resigned, Lee revealed that his lack of expertise in blockchain technology influenced his decision to leave office.
Meanwhile, Binance and Kolon’s proposed initiative to establish a cryptocurrency exchange may challenge Upbit, the prominent South Korean exchange. Data analytics shows Upbit commands more than 80% of the nation’s cryptocurrency investment market.
Before it collaborated with the Kolon Group, the Zhao-led crypto exchange on February 3rd acquired a considerable stake in Gopax. Gopax is a South Korean-based crypto exchange facing a financial crisis.
South Korean Regulators Questioning Binance’s Gopax Acquisition
By acquiring Gopax, Binance positioned itself to re-enter the South Korean market, which it departed approximately two years ago. Moreover, a few months ago, Binance revealed that one of its primary goals was to return to South Korea.
In November 2022, Gopax halted withdrawals for its DeFi service due to its connections with Genesis, a struggling crypto lender that had filed for bankruptcy. Binance intends to assist Gopax in restoring its regular functions and getting back on the right track.
However, South Korean financial regulators are scrutinizing Binance’s acquisition of Gopax. The authorities have expressed apprehension regarding Binance’s return to the South Korean market.
Per Chosun Ilbo, a local news outlet, regulators believe that the largest cryptocurrency exchange by market capitalization may amplify financial misconduct in the nation. The authorities believe that Binance’s “obscure” management style could lead to an upsurge in activities like money laundering.
Meanwhile, Binance reportedly left South Korea due to regulatory concerns and uncertainty surrounding cryptocurrency trading. The Korean government had been implementing stricter regulations on cryptocurrency exchanges and related businesses, which may have contributed to Binance’s decision to exit the market.
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