Binance Holdings Ltd., the world's No. 1 virtual asset exchange that once ran an exchange in Korea before shutting it down, has recently been testing the waters for a return to the domestic market by meeting with the heads of major commercial banks to discuss cooperation. Binance Holdings Ltd. acquired the domestic coin exchange GOPAX and recently received approval as a major shareholder from the financial authorities. However, GOPAX's debt issues and what will be included in the second-phase virtual asset law (Digital Asset Basic Act) remain variables.
According to the financial industry on the 23rd, SB Seker, head of Asia-Pacific at Binance Holdings Ltd., who visited Korea at the end of last month, separately met with Woori Bank President Jeong Jin-wan, Hana Bank President Lee Ho-sung, and NH NongHyup Bank President Kang Tae-young to discuss business cooperation. The discussions were reportedly aimed at enabling the use of Binance Holdings Ltd.'s payment service Binance Pay and its cryptocurrency BNB in the Korean market going forward.
Binance Holdings Ltd. has previously signed strategic partnership agreements with domestic Fintech firms. Binance Pay is a payment service that uses virtual assets and stablecoins, and in Korea, Nexpace, the Blockchain subsidiary of Nexon, payment company Danal, and B2En are engaged as payment partners. The intent is to build infrastructure so that foreigners coming to Korea can easily pay with Binance Pay.
With Woori and Hana Bank, discussions also covered Korean won accounts for GOPAX, in which Binance Holdings Ltd. is a major shareholder. Coin exchanges must sign contracts with banks to enable won deposits and withdrawals, and GOPAX is currently contracted with Jeonbuk Bank. GOPAX feels limited in expanding its customer base and wants to contract with a commercial bank.
The banking sector is reportedly proactive about collaborating with Binance Holdings Ltd. Banks can seek opportunities such as expanding overseas payment networks, attracting foreign customers, and developing new businesses based on digital assets. Using virtual asset payment infrastructure like Binance Pay could also allow them to preemptively establish a business foothold when stablecoins are institutionalized in the future.
For Binance Holdings Ltd. to operate properly in Korea, Gopai's debt repayment must come first. Gopai is a deposit service that pays interest when investors entrust virtual assets to GOPAX. After the bankruptcy of the global exchange FTX led to the collapse of the Gopai operator, GOPAX has not been able to recover the losses to date.
In addition, the second-phase virtual asset law currently under discussion includes a provision to limit an exchange's major shareholder equity to around 15%–20%, and if the stake is capped, Binance Holdings Ltd. would have to sell most of its equity in GOPAX.