Reports indicate that Richard Teng, Binance CEO, made a discreet trip to South Korea to establish connections with local financial authorities and address the challenges hindering Binance's entry into the South Korean market. Teng's unannounced visit aimed to engage with officials from the Financial Intelligence Unit (FIU) and other financial bodies to find a resolution. The visit followed Binance's unsuccessful attempt to acquire a majority stake in the South Korean crypto exchange, Gopax, which faced delays in gaining approval from regulatory authorities.
Binance's Acquisition of Gopax and Regulatory Delays
In late 2022, Binance acquired Gopax as part of its strategy to penetrate the South Korean market. However, regulatory approval for Gopax's transformation into a cryptocurrency platform has been pending for over a year, impeding Binance's market entry plans. The decision to purchase Gopax was influenced by its failure to reimburse users after the GoFi incident related to crypto asset deposit services. Binance assumed ownership of GoFi's debt and appointed Leon Singh Pung, Binance Asia Pacific's former president, as Gopax's CEO. Despite submitting the necessary reports to the FIU, the approval process has been consistently postponed.
Ongoing Review of Gopax's Changes by FIU
Gopax made headlines with the appointment of Cho Young-joong, replacing Lee Jung-hoon as the CEO. However, the FIU has yet to approve this change, which has been further complicated by BF Labs' acquisition of Binance's shares in Gopax. The FIU's hesitation stems from the legal challenges Binance is currently facing, primarily the hefty fines issued by the US Department of Justice.
Binance's Adjustments and Future Plans
To address FIU's concerns, Binance opted to divest its shares in Gopax and withdraw from the majority stake position. Furthermore, the FIU requested Gopax to present a governance enhancement plan in partnership with Jeonbuk Bank. In a recent development, Gopax offered its users the opportunity to increase their ownership by converting Binance shares into stock.
Anticipated Impact of CEO's Visit
Teng's discussions with South Korean government officials are anticipated to offer solutions to Gopax's challenges. Known for prioritizing compliance, Teng's visit underscores Binance's commitment to regulatory adherence. His prior roles in the Monetary Authority of Singapore and interactions with Gopax and Jeonbuk Bank officials highlight his active participation in Korea's financial sector.
This article first appeared on COINTURK NEWS: Binance CEO's Secret Visit to South Korea.
