As it awaits acquisition developments, GOPAX, a South Korean cryptocurrency exchange, secures a late reprieve.
GOPAX, a South Korean cryptocurrency exchange, has obtained a “temporary” banking agreement that has granted it an eleventh-hour reprieve, enabling it to continue trading fiat pairs.
According to News1, the exchange has executed a new nine-month agreement with its banking partner, Jeonbuk Bank.
The bank has previously informed GOPAX that it will not execute a longer-term banking agreement until the exchange’s operator has completed a takeover.
Under South Korean law, fiat trading is exclusively permissible for exchanges that provide real-name banking services through wallet-linked accounts.
On August 11, GOPAX’s previous two-year agreement with Jeonbuk Bank concluded. Prior to the completion of the acquisition, the bank had issued a warning that it would not renew its agreement.
Nevertheless, it seems that the parties have reached a provisional solution, which includes a new nine-month agreement.
The failure of GoPay, the exchange’s crypto administration service, in 2022 has undermined its fortunes. Binance, the global market leader, acquired a majority stake in the exchange in February 2023, which appeared to indicate a more promising future.
Nevertheless, the Financial Services Commission (FSC) has decided to obstruct this transaction and has mandated that Binance reduce the size of its holdings from approximately 70% to 10%.
Megazone, a cloud services provider, has submitted a proposal to acquire the majority stake in GOPAX that Binance holds.
Nevertheless, the regulatory authorities have not yet authorized this transaction. GOPAX has been “eroding capital” for several years, according to observers. And they also claim that Megazone has a high “debt ratio.”
Nevertheless, the recent agreement with Jeonbuk Bank will be a beneficial development for GOPAX. The agreement will enable GOPAX to submit an application for a new crypto-fiat trading permit in advance of the mandatory September deadline.
In an additional development, the Financial Intelligence Unit of the FSC has mandated that all fiat-trading exchanges in the country submit permit applications by mid-September. In October, the unit will issue a significant number of new permits.
The media outlet observed that Megazone is still enthusiastic about concluding the GOPAX acquisition. According to reports, the cloud provider submitted a Letter of Commitment to the FSC in July.
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