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Binance back in South Korea: FIU approves move to Gopax!
Binance aims to return to South Korea as FIU reviews Gopax application. Progress after legal challenges.
Binance back in South Korea: FIU approves move to Gopax!
Binance, one of the world's largest cryptocurrency exchanges, has made significant progress in resuming its operations in South Korea after the return process was delayed for over two years. Loud Crypto.News South Korea's Financial Intelligence Unit (FIU) has resumed review of Gopax's management change application, a move crucial to Binance's return to the country.
The review was previously halted due to concerns over Binance's legal issues in the US. In particular, the investigations against Binance by the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), which accused the exchange of offering unregistered securities and implementing inadequate controls over customer assets, contributed to the delay. The US Department of Justice and the Treasury Department also sued the exchange for violations of anti-money laundering laws, which ultimately led to a multi-year settlement at the end of 2023.
South Korean regulation and Gopax
Binance acquired a 67% controlling stake in Gopax in 2023 after that exchange ran into trouble due to a liquidity crisis. This crisis was caused by the bankruptcy of DeFi partner Genesis Global Capital, which occurred in January 2023. As a result of the bankruptcy, millions of customer funds were blocked, prompting Binance to deploy capital and restore withdrawals.
Recent reports show that the FIU has positively assessed the amendment request and approval is possible by the end of 2025. This marks a turning point as South Korea currently does not have a separate legal framework for verifying the suitability of major shareholders in crypto exchanges, meaning regulators rely on reports of management changes to assess the suitability of key players.
Planned future developments
The review of Gopax's management change application, which Binance submitted in March 2023, was largely tied to concerns about the country's anti-money laundering system. However, a crypto-friendly government under President Lee Jae-myung is ushering in a more open stance towards regulating digital assets. These changes in regulation could also open up prospects for other foreign crypto exchanges in South Korea.
Gopax is among five crypto exchanges in South Korea currently authorized to offer cash-to-crypto services. While Binance has not yet received a license to operate in South Korea, this could soon change if the proposed changes come to approval.