Binance teams up with Lee Woong-yeol to launch crypto exchange
Binance is reportedly in talks with the former head of South Korea’s chemical and textile conglomerate Kolon Group to establish a new virtual asset exchange in the country.
Lee Woong-yeol, honorary chairman of Kolon, is working with other blockchain-native firms to build the crypto trading platform that will cater to public and financial authorities. South Korean authorities are using strict new rules for crypto businesses to minimize the risk of money laundering and market manipulation, which took effect last year.
Kolon, a conglomerate with nearly 70 affiliated firms, has stakes in South Korean exchanges such as Dunamu. It was part of the plan to achieve revenues of $2.6 billion by 2025.
According to Korean local news sources, the honorary chairman has shown interest in blockchain-related business since he left during a leadership reshuffle back in 2018.
The news comes as part of Binance’s broader plans to return to South Korea after pulling out of the lucrative market in 2021. Prior to this alliance with Lee Woong-yeol, the world’s largest cryptocurrency trading platform acquired a majority stake in GOPAX.
The agreement was funded by the Industry Recovery Initiative (IRI), which the exchange established in November to help reduce further cascading negative effects of the FTX collapse. At the time, CEO CZ committed $1 billion to the fund in a public address, with another $1 billion to be added if the need arose.
Pending official approval from Korean authorities, Binance is in the final stages of completing the transaction, which will allow it to operate again in the South Korean crypto market.
The exact details were not disclosed, but according to a local media report, Decenter Binance bought a 41.2% stake from CEO Lee Jun-haeng. The largest shareholder in Gopax will for the time being maintain the current representative system to ensure stable management.
The collapse of the crypto exchange FTX has had an impact on South Korean exchanges, including GOPAX. The Seoul-based platform suspended payments in its DeFi service GOFi, which was introduced in partnership with crypto lender Genesis Global Capital.
CEO Changpeng Zhao revealed earlier in November that Binance is preparing to register under South Korean financial authorities by complying with local regulations. The exchange had previously opened a local office four years ago, but had to end its crypto trading services in December 2020.
Binance also discontinued global trading services for South Korean won in 2021 when local regulators banned foreign platforms from offering services to local residents.
