November 13, 2023 at 12:27 GMTModified date: November 13, 2023 at 12:27 GMT
November 13, 2023 at 12:27 GMT

Bithumb to become first crypto exchange to go public in South Korea

Reports have revealed Bithumb’s plans to go public in its home country during the second half of 2025. It is one of the largest exchanges in South Korea…

South Korea flag. Pic: Unsplash

Reports have revealed Bithumb’s plans to go public in its home country during the second half of 2025. It is one of the largest exchanges in South Korea, with $205million in daily trading volume as of writing.

A green light from the authorities would help the exchange to expand its share in the market which is currently dominated by its main competitor – Upbit. The latter has more than 80% of the South Korean market.

The market share of Bithumb, on the other hand, stands at only around 15% to 20%. A while back, it had tried to narrow the gap with Upbit by offering fee-free trading for all cryptocurrencies starting on 4 November. However, the impact was observed to be quite limited.

Bithumb now plans to be listed on Kosdaq, which is the South Korean counterpart to Nasdaq. The exchange is also open to an initial public offering (IPO) on the country’s main stock market, the Kospi, said a Bithumb official. It had reportedly selected Samsung Securities as its manager for the same at the end of October.

While this is Bithumb’s first IPO attempt, there were speculations about it in 2020. However, the company denied them at the time. The move is aimed at gaining market trust as it will be the first crypto exchange to enter the “regulatory framework”, if approved.

The exchange was founded by South Korean entrepreneur, Dae-sik Kim, in 2018. The platform supports crypto bot trading, provides extensive investment opportunities and accounts for institutional investors, ensures access to major liquidity pools, offers clients the option to earn passive income through deposit programs, and presents 24/7 customer support and a user-friendly interface.

South Korea has been quite stringent with its rules for the crypto sector recently. It started in 2021 when authorities targeted all “illegal activity involving virtual assets” during a “special enforcement period” where various state agencies were given the authority to investigate, monitor and punish crypto businesses, or virtual asset service providers (VASP).

In July this year, the country’s Financial Services Commission (FSC) introduced a new rule which requires companies holding digital assets to disclose their crypto holdings, starting in 2024. The move is aimed at providing investors with clearer information, enabling them to make well-informed decisions.

This was soon followed by the FSC cracking down on over-the-counter (OTC) crypto trades as they observed an increase in scrutiny over possible involvement in criminal activities.

Its deputy chief prosecutor, Ki No-Seong, called for closer inspection in the OTC crypto market saying: “Illegal virtual currency OTC companies have overseas corporations and are engaged in the business of converting illegally obtained virtual currency into Korean won or foreign currency. There is a need to regulate these companies as undeclared virtual asset trading businesses.”

He then revealed that his team had plans to continue researching and thinking about the investigation of illegal currency OTC. As per reports published back then, the director of the Capital Markets Department also suggested the need for stronger regulation of virtual currencies and pointed to OTC crypto as the “epicentre of virtual currency-related crimes”.

Last month, the country announced plans to launch a central bank digital currency (CBDC) pilot program too. It is led by South Korea’s central bank, the Bank of Korea (BOK) and is aimed at studying and establishing the necessary technical infrastructure required for a CBDC.

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