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Today, the local South Korean publication Chosun Ilbo reported that Binance is in negotiations to sell its stake in Gopax to Megazone Cloud’s parent company, Megazone. This move signifies a significant shift in Binance’s strategy regarding its participation in the South Korean cryptocurrency market. The negotiations are reportedly in the final stages, and the deal could be close.
Stake Reduction Plans
Binance aims to reduce its 72.6% stake in Gopax’s operator Streamy to 10%. This significant stake reduction plan aligns with regulatory pressures from South Korea’s financial authorities.
Binance became the largest shareholder by acquiring a significant portion of Gopax’s shares last February. However, South Korea’s financial regulator has not yet officially recognized Binance’s position, leaving the company in regulatory uncertainty for over a year.
Regulatory Pressures and FSC’s Role
The Financial Supervisory Commission (FSC) of South Korea played a critical role in this development. According to sources in the cryptocurrency field, the FSC explicitly requested Binance to change its status as the largest shareholder. This regulatory pressure is a significant factor behind Binance’s decision to reduce its stake.
The FSC’s request likely stems from concerns about market dominance and governance practices in South Korea’s cryptocurrency sector.
Binance’s Response and Compliance Efforts
In response to the FSC’s request, Binance has shown willingness to comply and has communicated its intention to improve its governance structure to regulators. This move can be seen as an effort to align more closely with South Korean regulatory standards and to conduct smoother operations within the country’s financial system. Binance may also aim to reduce potential regulatory risks and demonstrate its commitment to adhering to local laws and guidelines by reducing its stake.
The potential sale to Megazone, a significant player in the cloud computing sector, could have broader implications for Gopax and the South Korean cryptocurrency market. Megazone Cloud’s involvement could bring new strategic directions and resources to Gopax, potentially enhancing its operations and market presence. This deal may also indicate a shift in the competitive landscape of the South Korean crypto market with the introduction of new stakeholders with different expertise and priorities.
