Binance’s Acquisition of GoPax Delayed by South Korean Regulator Due to SEC Lawsuit: Report

Crypto exchange Binance’s acquisition of GoPax is on pause as regulators examine the SEC’s lawsuit against Binance, according to a local media report.

South Korea’s Financial Services Commission has put Binance’s acquisition of South Korean crypto exchange GoPax on pause following the Securities and Exchange Commission’s (SEC) enforcement action against Binance.

Newspim, a local South Korean news site, reported that the country’s financial regulator is delaying the acquisition of GoPax by Binance and is monitoring news surrounding Binance, including the SEC lawsuit.

The financial regulator had already delayed the acquisition in April due to money laundering allegations, according to the report.

Binance announced that it would re-enter the South Korean market in February by buying a majority stake in GoPax. The funding of the purchase came from Binance’s recovery fund, which was set up in response to the fallout of the collapse of crypto exchange FTX. GoPax’s parent company Streami Inc. is listed as one of the largest creditors of bankrupt crypto lender Genesis Global, Bloomberg reported.

GoPax halted withdrawals for certain products due to the exposure to Genesis Global. Binance planned to inject capital into the exchange to enable those withdrawals, said Yibo Ling, Binance’s chief business officer, in an interview with Bloomberg.

Binance closed its operations in South Korea in December 2020 due to low usage and volumes. The region is known for having a strong interest in crypto trading but was rocked by the multi-billion dollar collapse of the Terra-Luna blockchain ecosystem, which was founded by Do Kwon, a South Korean national. South Korean authorities issued an arrest warrant for Kwon and several other Terra executives for violating capital markets laws.

Binance, the Financial Services Commission and GoPax did not immediately respond to a request for a comment.