Topic: [2017-09-26] South Korea’s Second Largest Exchange Korbit Acquired at $150 mln (Read 2051 times)

NXC, the holding company of Nexon, the $10 billion Japanese gaming company founded by South Korean entrepreneur Kim Jung Ju in 1994, has acquired Korbit, the second largest cryptocurrency exchange in South Korea and the first bitcoin exchange in the country, at a $150 million valuation.

According to sources close to the deal including Hankyung, South Korea’s largest finance and business news publication, Nexon purchased 65.13 percent of Korbit’s shares for $90 million, valuing the company at over $150 million.

Why Did Nexon Purchase Korbit?

As of current, the daily trading volume of the South Korean cryptocurrency exchange market is similar to that of the trading volume of major South Korean stock markets including the KOSDAQ. For years, Korbit has led the South Korean cryptocurrency and bitcoin exchange markets, receiving investment from billionaire venture capitalist Tim Draper and South Korea’s largest telecommunications conglomerate SK Telecom.

While Korbit is only the 16th largest cryptocurrency exchange in the world, and is far behind Bithumb, its competitor in terms of daily trading volume, it has strong brand power within the South Korean cryptocurrency exchange market. More to that, Korbit remains as one of the leading cryptocurrency trading platforms for certain cryptocurrencies such as Ethereum.

In an interview with Hankyung, a fintech advisor based in South Korea explained that the deal between Nexon and Korbit is unprecedented, and that the acquisition of Korbit would likely spur an increasing number of investments and mergers within the South Korean cryptocurrency sector.

Strengthening of the Japanese and South Korean Bitcoin Markets

The South Korean gaming and technology industries are familiar with the company Nexon because it has operated within South Korea since its launch in 1994. The company initially started out as a South Korean gaming company with headquarters in Seoul and as a result, the majority of gaming enthusiasts still to this date consider Nexon as a South Korean company.

In actuality, Nexon is a multi-billion dollar technology giant headquartered in Japan and listed on the Japanese stock market. The holding company of Nexon is based in South Korea, which is known as NXC. And now, the holding company of a Japanese technology conglomerate is the parent company of the South Korean cryptocurrency exchange market’s second largest exchange in Korbit.

Large-scale conglomerates in South Korea including SKT have made several investments into the cryptocurrency sector and emerging startups. But, the Japanese bitcoin industry has become significantly more active due to the involvement of companies GMO and Nexon and their major investments in bitcoin companies.

Earlier this year, the GMO group, another multi-billion technology and Internet company, announced the launch of Z Coin, a bitcoin trading platform targeted at institutional and retail investors. Upon the launch the Z Coin trading platform (coin.z.com), GMO also announced its plans to invest $30 million in manufacturing ASIC miners and establishing bitcoin mining centers in Europe.

“We expect to incur expenses for establishment of the next-generation mining center and research and development and manufacturing of hardware including the next-generation mining chip. We will not disclose the specific amount due to the non-disclosure agreement with our alliance partner, but it will be more than 10% of the consolidated noncurrent assets as of December 31, 2016 (¥3,489 million),” said GMO.

The acquisition of Korbit by Nexon will likely trigger more deals and mergers in the Japanese and South Korean bitcoin industries and exchange market in the upcoming months.

https://www.cryptocoinsnews.com/south-koreas-second-largest-exchange-korbit-acquired-at-150-million-valuation/