South Korean internet titan Naver, with 40 million monthly active users, is poised to snap up Dunamu, the operator of crypto exchange platform Upbit, in a move that could redraw the map of the country’s financial landscape.
Local news reports on Thursday say Naver will incorporate Dunamu into its business group as a fully owned subsidiary through a comprehensive stock swap.
Naver Financial, the company’s fintech arm, will execute the stock swap by issuing shares to acquire Dunamu in full.
The stock-only structure means Naver won’t have to front the cash upfront to do the deal.
Naver’s stock price is up 11% following the news.
South Korea’s crypto market
The move carries big stakes for Naver and South Korea’s crypto market.
Upbit is the country’s largest crypto exchange and the fourth biggest globally by daily trading volume. The platform is central to the liquidity for trading major altcoins, such as XRP and Cardano.
Alongside Bithumb, Korbit, and Coinone, Upbit forms what’s called South Korea’s “big four,” the country’s four most prominent cryptocurrency exchange platforms.
Naver is also a major player in Korea’s financial market through its fintech arm, which handles $58 billion in annual payment volume.
Both Naver and Dunumu are already developing a stablecoin pegged to the Korean won, and the deal has been cast as a means to push Naver into the international market, according to news reports.
Regulatory hurdles
However, crypto trading in South Korea is heavily restricted to South Korean citizens.
The deal also underscores a global trend of internet and fintech giants steadily colonising crypto rails to expand their businesses.
From PayPal and Stripe to the likes of Kakao, Naver, and Rakuten, several internet and fintech giants have recently embedded crypto products directly into their sprawling payment and financial markets.
Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. Got a tip? Please contact him at [email protected].
