A Singapore-based consortium has just acquired a 38-percent stake in Bithumb, one of South Korea’s largest cryptocurrency exchanges. The deal is viewed as a positive development for the exchange as it could improve its security and even speed up its entry into the Singaporean market.
Singapore-Based Consortium Acquires 38% Stake in Bithumb
Bithumb, one of South Korea’s largest cryptocurrency exchanges, has a new investor. On Oct. 11, BK Global Consortium, a Singapore-based group led by well-known plastic surgeon and blockchain platform investor Kim Byung-gun, inked a deal with Bithumbs largest shareholders to acquire 38 percent of the company.
According to Reuters BTC Holdings agreed to sell 50 percent plus one of its Bithumb shares to the Singaporean consortium to the tune of 400 billion won or around US$354.09 million. Before the transaction, BTC Holdings was the largest stakeholder of the exchange and owned 76 percent of the company.
With the acquisition, BK Global Consortium will end up owning a little over 38 percent of Bithumb. On the other hand, BTC Holdings ownership of the exchange will be diluted to just under 38 percent.
Extra Layer of Liquidity, Singapore Expansion
The acquisition will provide the exchange with an extra layer of liquidity and security, which are essential to a very volatile market, according to Asia Times. With the deal, Bithumb now joins the ranks of South Korea’s other exchanges that are backed by large conglomerates. For instance, Korbit is run by gaming giant Nexon, while Upbit is run by Internet giant Kakao.
With their focus on security, these exchanges that are run by large conglomerates have never been hacked. In contrast, Bithumb’s most recent hack happened in June 2018, where more than $30 million worth in digital currencies were stolen.
But BK Global’s investment could bring more than just better security and stability for Bithumb. Being based in Singapore, BK’s entry into the South Korean exchange could speed up its expansion plans into the island nation. Being a financial center coupled with its crypto-friendly atmosphere, Singapore is a perfect destination for any growing crypto-related business.