[비즈한국] The acquisition process of GOPAX by Binance has been concluded. Binance, the world’s largest virtual asset exchange, became the major shareholder of the domestic KRW-based virtual asset exchange GOPAX (operated by Streami) in February 2023, but it had failed to receive approval from financial authorities. With Binance finishing the acquisition-related procedures, the path for its full-scale entry into the Korean market has opened, drawing attention to the revival of GOPAX and the resolution of the 'GoFi' crisis.
On the 16th, GOPAX announced through a 'Notice of Acceptance of Board Change Report' that the Binance acquisition process has been completed. Furthermore, the company explained that in cooperation with its major shareholder, Binance, it is reviewing follow-up procedures such as securing funds to repay victims of the 'GoFi' deposit service and obtaining consent from minority shareholders.
Although Binance became the major shareholder by acquiring a 67.45% stake in GOPAX operator Streami in February 2023, the legal process remained pending as the Financial Intelligence Unit (FIU) did not accept the report on board changes. Under the Act on Reporting and Using Specified Financial Transaction Information (Specified Financial Information Act), Virtual Asset Service Providers (VASPs) must report their business status to the FIU. This reporting procedure is also required when registered executives or representatives change. In principle, the authorities should notify whether a report is accepted within 45 days of receipt, but the FIU had delayed the acceptance for nearly three years.
Having completed the major shareholder change, GOPAX states it will focus on resolving the GoFi crisis. The GoFi crisis refers to an incident in November 2022 where users were unable to withdraw their GoFi deposits following the collapse of the global virtual asset exchange FTX. Genesis Global Capital, which operated the GoFi investment funds, halted new loans and redemptions due to the FTX bankruptcy, leaving GOPAX with the burden of repayment after losing investor deposits.
The scale of damages has grown as the price of Bitcoin has risen since the incident. According to Richard Teng, CEO of Binance, in an interview with domestic media in September, 48% of the debt has been repaid, leaving remaining damages of $122 million (approximately 173.4 billion KRW). Binance has emphasized that it would resolve the situation once regulatory approval was granted.
GOPAX stated, “This acceptance of the change report is one of the processes to enhance GOPAX’s management stability and meet necessary institutional requirements. Under any circumstances, we will not stop our efforts for customer asset repayment and user protection,” adding, “We will use the renewal report procedure that follows this measure as a practical turning point for resolving the GoFi issue.”
Financial authorities had delayed the acceptance of the change report due to concerns surrounding Binance regarding money laundering issues and controversies over tax evasion. Afterward, in June 2024, authorities strengthened the VASP reporting system according to the enforcement decree and supervisory regulations of the Specified Financial Information Act. While the change of a major shareholder was not a mandatory reporting item for VASPs, information regarding major shareholders was added after the amendment. The goal is to monitor the status of the largest and major shareholders. A legal basis for suspending the review of reports was also established. Authorities can suspend the review of a VASP’s report if the reporting business, representative, executives, or major shareholders are undergoing criminal proceedings or are being investigated by financial authorities or investigative agencies.
GOPAX, which had been struggling due to the GoFi crisis, major shareholder approval issues, and a difficult market environment, seems to have breathed a sigh of relief with this report acceptance. Looking at Streami’s operating profit, the deficit narrowed from -76.5 billion KRW in 2022 to -16.9 billion KRW in 2023, but it increased again to -29.8 billion KRW in 2024. A GOPAX official said, "We will focus on achieving financial improvement after debt repayment and creating momentum for business resumption."
GOPAX is also awaiting the results of the VASP license renewal it applied for at the end of last year. VASPs are required to renew their licenses every three years under the Specified Financial Information Act. However, since the renewal result for Upbit (operated by Dunamu), which was the first to apply, has not been released, it appears the acceptance of GOPAX's report will also be delayed.
Binance has opened a path to enter the Korean virtual asset market through GOPAX. When Binance acquired the stake in February 2023, its position was that it would "separate GOPAX management from the board," but attention is focused on whether it will step into management after investing a large amount of funds to resolve the GoFi crisis. GOPAX explained, "There are no full-time employees dispatched since Binance’s acquisition," adding that Binance does not interfere in GOPAX’s management. Currently, the only person from Binance among Streami’s registered executives is inside director Steve Young Kim.
Because of this, attention is focused on whether Binance and GOPAX will share an 'order book'. Sharing an order book with Binance, the world's largest exchange, could increase trading volume and stabilize virtual asset prices. This could also change GOPAX’s position in the domestic market, which is currently dominated by Upbit. However, the possibility of implementation is low as sharing an order book involves transferring personal information, which has legal constraints, and infrastructure for such sharing would also need to be built.
Conflicts between Binance and the former management of GOPAX also remain. The two sides are reportedly going through international arbitration procedures while disputing debt repayment for GoFi and the payment of acquisition funds. In April of this year, Streami CEO Cho Young-joong filed a lawsuit against former CEO and founder Lee Jun-haeng, alleging breach of trust, claiming that Lee had demanded compensation for the value of his own shares.