Nexon, a leading South Korean video game publisher has reportedly ‘stepped up’ to acquire Bithumb, the country’s largest cryptocurrency exchange, for roughly 500 billion won ($460 million.)
The deal is being led by Nexon CEO Kim Jeong-Joo, showing how important this transaction is for the gaming giant.
According to local media reports, Nexon signed a memorandum of understanding (MOU) with the exchange at the beginning of the month to acquire a 65% stake. Nexon is said to be working Vidente, the second-largest shareholder of the Bithumb, to get full control of the exchange.
The deal is perceived by some analysts as a major stepping stone for the local crypto industry. Bithumb is the biggest exchange by trading volume but has endured some issues in the past including being investigated for fraud.
The acquisition by the leading gaming conglomerate could turn around the fortunes of the exchange and strengthen the industry’s argument that it is ripe for mainstream adoption.
The news comes at a time when the industry’s market capitalization surpassed $1 trillion. With prices soaring higher, exchanges could be in for a busy period as traders and investors buy and sell digital assets.
Nexon is not a new kid on the crypto industry block. It has previously acquired Bitstamp and Korbit and if this deal is finalized, Nexon will own three exchanges.
Nexon bought Bitstamp in October 2018 through NXMH, an investment firm owned by NXC. NXC is the parent company of the gaming giant.
Korbit was purchased in September 2017 for around $80 million.
It was reported in September last year that the exchange was looking for a buyer. Accounting firm Samjong KPMG was given the task of selling Bithumb for a price ranging from $430 million to $604 million.
Several domestic and foreign buyers showed interest in acquiring the exchange but had to back down due to some hurdles.
The interested buyers slowed down after a revelation that the exchange and Chairman Lee Jung Hoon were being investigated for fraud. They are alleged to have sold Bithumb’s native BXA tokens worth $25 million to investors but failed to list the token, leaving investors to count their losses. Lee faced additional charges.
In September last year, Digital Currency Group (DCG), a firm that buys and invests in bitcoin and blockchain companies, acquired the cryptocurrency exchange Luno for an undisclosed fee.