Bithumb South Korea Cryptoexchange Bought by Singapore Consortium

Bithumb South Korea Cryptoexchange Bought by Singapore Consortium

Bithumb, South Korea’s largest cryptocurrency exchange by trading volume, has reportedly been sold to a Singapore-based consortium for approximately 400 billion won ($354 million). Kim Byung-gun led Bk Global Consortium will acquire the controlling stake becoming the largest shareholder of Bithumb.

Landmark Deal

Bithumb, headquartered in Seoul, South Korea has consistently led the cryptocurrency market in terms of daily transactions. The average daily liquidity turnover at the exchange was equivalent to $1.3 billion by the end of 2017. The main clients of the site are residents of this country and Bithumb accounts for half of all trading volumes on ether and three quarters on bitcoin.

The deal was confirmed by a spokesman for Bithumb on Friday, stating that the exchange “was sold for about $354 million to a consortium led by a plastic surgeon,” Reuters reported and quoted him saying : “Bk Global Consortium, led by Kim Byung-gun, plastic surgeon and blockchain platform investor, signed a deal on Thursday to buy 50 percent plus one share in the exchange’s biggest stakeholder, BTC Holdings, for about 400 billion won ($354.09 million). The deal makes Bk Global Consortium the largest stakeholder of Bithumb.”

BTC Holdings was revealed to be the largest shareholder of Bithumb in their April audit report, holding a 75.99 percent stake in the exchange. Vidente Co. Ltd, with a 10.55 percent stake was the second largest shareholder, followed by Omnitel at 8.44 percent, Chosun detailed.

Bk Plastic Surgery was established 23 years ago by Kim and is the representative of the Bk Medical Group, which links China, Singapore and Korea, MTN detailed. Kim also established an ICO platform in Singapore last August. The deal for the exchange will be finalized in February, reported Bloomberg.

Bithumb revealed in June that it was hacked and 11 cryptocurrencies were stolen. The estimated damage of the attack was 19 billion won. Nevertheless to say that Bithumb is doing well is an understatement, according to Vidente, the exchange posted 218.6 billion won of operating profit and 39.3 billion won of net income in the first half of the year, Bloomberg described. Semi-annual reports released by BTC Holdings show that Bithumb’s sales reached 303 billion won in the first half of this year.

Bithumb’s appraisal in early February valued the exchange at $880 million, in addition to that the consortium’s own valuation of the exchange is even higher, at more than two trillion won plus the management rights premium. The news outlet quoted a Bk Global Consortium official asserting: “We will also promote the introduction of a stable coin to stabilize the payment system. We will be in conjunction with the global exchange scheme to take advantage of the coin linked to the US dollar”

In other news – South Korean Financial Regulator Reaffirms Conservative Stand on Crypto

Speaking at the parliamentary audit session of the commission held at the National Assembly, the chairman of Korea’s Financial Services Commission Choi Jong-koo has reaffirmed his negative position on digital currencies and Initial Coin Offerings (ICOs), Business Korea reported Oct. 11.

ICO’s were described as “almost a gamble” by the authorities while prohibiting the practice last September. But this August, Korean lawmakers, including participants from government ministries, revisited the cryptocurrency issue, aiming to repeal the country’s ICO ban. After reconsideration, Lawmakers agreed on the need to develop a related policy before carrying a resolution on ICO reallowance.

Choi reportedly stated after the session that “the government does not deny the potential of the blockchain industry,” while noting that it “should not equate the cryptocurrency trading business with the blockchain industry.” he went on to explain that “Many people say the Korean government should allow ICOs, but ICOs bring uncertainty and the damage they can cause is too serious and obvious. For these reasons, many foreign countries ban ICOs or are conservative towards them.”

Choi also took the opportunity to address the criticism of commercial banks that refused service to crypto exchanges, stating that “exchanges should be able to persuade banks to issue bank accounts to them”. Other officials have said that the South Korean government is “likely” to announce its official stand on ICOs in November. Hong Nam-ki, the Chief of the Office for Government Policy Coordination said that once the government finalizes its discussion and receives the results of a government survey, their decision will be announced.