Binance is preparing to expand into South Korea, having already hired Koreans for some local positions. CEO Changpeng Zhao has stressed the importance of the Korean market, noting that some Koreans are already using Binance, especially to trade newer coins. However, the exchange is reportedly waiting for the country’s crypto regulatory framework to be fine-tuned before actually launching.
Binance Eyes South Korean Market
Binance, the world’s largest cryptocurrency exchange by trading volume, is eying the South Korean market for expansion, Business Korea reported Tuesday.
Quoting CEO Changpeng Zhao during his keynote speech at the Blockchain Partners Summit in Seoul on July 21 and 22, the publication elaborated:
He stressed the importance of the South Korean market, saying that his company would enrich its community in the market.
The company has “hired Koreans as a local marketing director and a Binance Lab director, which is a social impact fund,” the publication added.
Binance added the Korean language to its website in August last year. “Now, our customers from Korea can use our website in their native language,” the company wrote at the time.
The timing proved fortuitous as the following month the Chinese government shut down exchanges in China, forcing local traders to move to exchanges elsewhere including South Korea. Binance also moved its operations out of China at that time.
Competing with Korean Crypto Exchanges
According to reports, South Korea has about 100 crypto exchanges, 31 of which are members of the Korean Blockchain Industry Association. However, only four exchanges hold the majority of the market share of crypto trading in the country.
Bithumb and the Kakao-backed Upbit are the largest crypto exchanges in the country, although Upbit is an affiliate of the U.S. exchange Bittrex.
At the time of this writing, Coinmarketcap shows Upbit has a 24-hour trading volume of $780,019,012 while Bithumb has $601,046,530.
The other two large Korean exchanges are Coinone and Korbit. A few other Chinese crypto exchanges have tried to open in South Korea such as Huobi and Okcoin.
“The number of South Korean Binance users is not that large yet. Still, it is one of the most favorite foreign cryptocurrency exchanges for South Korean traders,” Business Korea detailed. The Investor earlier this year wrote, “contrary to widespread speculation that Korean users account for a significant part of the Binance user-base, Zhao told reporters that they make up only about 1 percent and are the 10th largest group in terms of nationality.”
In an interview with Soso Lab this month, Zhao said the main reason Binance had gained popularity in South Korea was due to Korean exchanges listing only a limited number of coins. “If you want to trade newer coins then Binance is a good choice. We got lucky in that sense,” Zhao revealed. According to Coinmarketcap, Binance currently lists 376 coins while Upbit has 268 and Bithumb has 37. Zhao told the media outlet:
We do have a lot of users, what we call Binancians, in Korea…I think Korea is a hot market.
Korean Regulation Undergoing Changes
Bithumb, Upbit, Coinone, and Korbit have access to real-name accounts but the rest of the exchanges currently do not. This creates problems for the regulators who believe that without the real-name accounts, exchanges have to continue using corporate accounts to trade cryptocurrencies and these accounts are prone to money laundering.
Recently, the country’s top financial regulator, the Financial Services Commission (FSC), announced its plan to undergo a major restructuring including setting up a dedicated bureau for crypto policies. The government has also indicated that it will ease crypto regulation.
With the changing crypto regulatory environment in South Korea, the Investor reported Zhao saying earlier this year that Binance had postponed its plan to launch in Korea “until Seoul fine-tunes the regulatory framework.”
What do you think of Binance launching in South Korea? Let us know in the comments section below.
Images courtesy of Shutterstock, Changpeng Zhao, and Binance.
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