- Despite facing challenges with GoFi-related debts and a net loss due to the situation with Genesis Global Capital, Gopax has demonstrated resilience by achieving a 97% year-over-year revenue growth in 2023.
- This strong performance suggests that Gopax has been able to adapt to changing market conditions and capitalize on the rising popularity of cryptocurrency in South Korea.
Gopax, a South Korean cryptocurrency exchange backed by Binance, reported a net loss of 51.3 billion Korean won (approximately $37 million) in 2023, significantly less than the 90.6 billion won net loss in 2022, according to the year-end financial report from its parent company, Streami.
Despite the loss, the exchange experienced a strong year in terms of revenue, growing by 97% to 3.1 billion won compared to the previous year. Its net operating loss also decreased by 78% to roughly 17 billion won. The improved performance is attributed to a bullish market sentiment in 2023, as South Korea remained one of the most active crypto markets globally.
However, much of Gopax’s financial troubles stemmed from its connection to Genesis Global Capital, which suspended withdrawals in November 2022 amid a liquidity crisis due to its exposure to FTX. Genesis operated Gopax’s crypto custody service GoFi, which still owes users 63.7 billion won.
Binance’s Involvement and Challenges
Binance acquired Gopax in February 2023 in an effort to address its liquidity issues and strengthen its position in the South Korean market. However, local financial authorities have delayed approval of the ownership transfer due to concerns about Binance’s legal challenges in the United States.
Binance’s Asia-Pacific business development director, Steve Kim, stated that the company is considering reducing its stake in Gopax to become the second-largest shareholder to ease the exchange’s debt and compliance pressures. Binance CEO Richard Teng also visited Seoul in March to meet with financial regulators.
Currently, Binance remains the largest shareholder in Gopax with a 67.45% stake. While the global exchange is considering changes to its shares in the South Korean exchange, there are no updates on any immediate shifts in ownership.
Gopax did not immediately respond to requests for comment regarding the situation.
Future Prospects for Gopax and Binance
While Gopax has made significant progress in narrowing its net loss and achieving robust revenue growth in 2023, its future prospects remain intertwined with Binance’s involvement and potential adjustments to their ownership stake. The ongoing negotiations and challenges with local financial authorities could shape the path forward for both Gopax and Binance in the South Korean market. The ability to resolve GoFi-related debts and compliance issues will be crucial for the long-term success of the exchange.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
