November 25, 2024

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A deal to sell Bithumb, South Korea’s largest cryptocurrency exchange, is at the risk of falling apart one year after the decision to sell it, industry sources said Sept. 30.

BTC Korea Holdings, which operates Bithumb and owns a 76 percent stake in the exchange, on Oct. 12 last year said that it had agreed to sell the firm’s 50 percent stake plus 1 share to Singapore-based BK Global Consortium for 400 billion won ($333 million).

The deal was originally expected to be completed in February and was extended twice. But the deadline to pay the remainder amount for aquisition has been extended twice -- the latest is Sept. 30. 

The consortium led by plastic surgeon Dr. Kim Byung-gun, chairman of BK Group, has not made the full payment industry sources said. In April, the deadline was pushed back on the condition of BK raising its stake from 50 percent to 70 percent.

Last year, BK made a down payment of $100 million. It had a plan to issue its own digital coin but the plan was hit by the tepid crypto market. The down payment might become a subject of a legal battle.

In July, Kosdaq-listed Dual Industrial announced that it had decided to buy a 57.41 percent in BK Group for 235.7 billion won -- a move seen as BK’s effort to finance funds for the Bithumb acquisition. But Dual later withdrew the plan later that month.

In September, Kim found another investor -- Cho Yoon-hyeong who is behind Kosdaq-listed Cornerstone Networks. Cho owns 100 percent stake in Paradise Point which is the largest shareholder of Conerstone, an electronic education equipment maker.

Cho is rumored to have participated in a capital increase of BK Group with his personal assets -- worth 300 billion won -- and he chipped in 150 billion won, according to sources.

On Sept. 30, he downplayed media reports that the deal could collapse.

“The deal is proceeding smoothly, and we’re working on details with BTC Holdings,” he said, adding that he expects to complete the acquisition soon.

A Bithumb official said he had no information regarding the news reports. “Bithumb has stable management, so there won’t be any impact should the deal collapse,” he said.

By Park Ga-young (gypark@heraldcorp.com)