Bithumb to Undergo Plastic Surgery Under New Owner

South Korea's largest cryptocurrency exchange, Bithumb, confirmed the information on the sale of a 38% share to a Singaporean blockchain consortium for $350 million or 400 billion won, a local Korean media reports.

According to the publication, Bithumb announced that on October 11 it made a deal with the BK Global Consortium, an investment blockchain division of the Singapore-based BK Global, a plastic surgery company.

BTC Holdings Company, currently owning a 76% stake in Bithumb, agreed to sell 50% plus one share. This will make BK Group the largest shareholder in the South Korean stock exchange after the transaction is completed.

During the negotiations, Bithumb was valued at more than 1 trillion won, or about $880 million. The BK Group Chairman and Plastic Surgeon Kim Byung Gun is also an early cryptocurrency investor. He founded an ICO consulting firm and an ICO platform in Singapore in summer 2017.

The representative of the consortium commented the deal to News Asia:

As for the new owner, Kim Byung Gun has big plans for the exchange. Among them is to open ‘Bithumb Dex’ – a decentralized exchange through his Hong Kong subsidiary this month. Bithumb’s Dex can solve the existing problem of hacking, a curse for Korean exchanges.

Together with Q2, a Singapore-based e-trade platform, BK plans to create a payment system for goods which will reduce the risks related to price fluctuations. BK is also eyeing to introduce their own stable-coin in the near future.

Bithumb recently released data on its financial performance for the first half of the year, reporting a net profit of $35 million. A figure seems even more impressive as it was achieved despite a break-in that happened in June, which cost the exchange $31 million in losses. Back then some crypto community members suspected the exchange of staging a fake cyber-attack because of a $28 million (30bn won) tax bill the company was facing.

Later, thanks to the financial injections, the amount was reduced to $17 million.

According to the data from CoinMarketCap, after the hacker attack, the trading volumes of the exchange fell from $400 to $124 million per day. The crypto exchange also had to suspend the deposit and withdrawal of assets.

Several months earlier the platform has experienced a significant decline in trading volume as a result of suspending new accounts registration on the platform on July 31. The platform had to introduce this measure stating that it was necessary to improve the service. However, the Korean media back then has unveiled the real reason. The platform didn't manage to get agreements with the banks. At that time, Bithumb was the only major exchange in the country operating without an agreement to open accounts. Nonghyup Bank refused to sign the contract because "Bithumb still has problems in protecting consumers and information and preventing money laundering."

At the end of August, the platform has managed to come to an agreement with Nonghyup Bank and has resumed registering new accounts in September.

Since January this year, the anonymous trade in cryptocurrencies through virtual bank accounts has been banned in South Korea. The exchanges are obliged to renew agreements with banks every six months.

Currently, Bithumb’s 24h trading volume is $1.2 billion, according to the data from CoinMarketCap.