SK Square attracted to Korbit's simple shareholding structure Crypto exchange believed to be undervalued

Translated by Kim So-in 공개 2021-12-03 08:14:45

이 기사는 2021년 12월 02일 08:05 더벨 유료페이지에 표출된 기사입니다.

South Korea’s SK Square, the investment firm spun off from SK Telecom, has selected the country’s fourth largest cryptocurrency exchange Korbit as the first investment as it was attracted to the crypto exchange’s simple shareholding structure.

Korbit’s simple shareholding structure, with NXC as its largest shareholder, is considered the most attractive factor. As of the end of last year, Korbit was largely owned by three major shareholders – NXC, Korbit's former CEO and co-founder Tony Lyu, and Simple Capital Futures – with less than 2% owned by others.

This has allowed SK Square to make the investment decision without going through a complicated negotiation process. SK Square chief investment officer Yoon Poong-young and NXC chairman Kim Jung-ju quickly reached an agreement after the talks started. SK Square has decided to purchase shares worth 30 billion won ($25 million) owned by Lyu and inject 60 billion won by acquiring new shares.

This process would not have worked for Bithumb, which has a very complicated shareholding structure. Other crypto exchanges Upbit and CoinOne already have strong ties with existing investors. Dunamu, which operates Upbit, has its long-time investor Kakao Corp, while CoinOne sold a 38% stake to local game developer Gamevil.

Korbit was practically the last one left among the country's four crypto exchanges for SK Square to secure the second-largest shareholder status. Diversifying risks by securing a strategic investor was also an attractive option for NXC, which had to pour a large amount of money into Korbit for over four years. The founder Lyu’s needs to exit was another factor that enabled a speedy deal.

SK Telecom has worked with Nexon Korea, the crown jewel of NXC, since 2019. The country’s largest mobile carrier and the country's leading online game developer signed a partnership last year to cooperate in content and gaming services and collaborate in the e-sports sector.

SK Square has also believed Korbit was undervalued despite its technological capability because its trading volume is the lowest among the four crypto exchanges and it has not been put up for sale lately. (Reporting by Sang-woo Seong)
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