Kakao Sells Stake in Dunamu, Operator of South Korea’s Largest Crypto Exchange Upbit, to Hana Bank for $670 Million

Kakao Sells Stake in Dunamu as South Korea’s Crypto Landscape Evolves

In a significant shift within South Korea’s burgeoning cryptocurrency market, Kakao, the internet giant known for its diverse digital services, is partially exiting its investment in Dunamu, the operator of Upbit, the country’s largest crypto exchange by daily trading volume. The move comes as Kakao’s investment arm, Kakao Investment, has announced the sale of a 6.55% stake in Dunamu to Hana Bank for a staggering 1 trillion won (approximately $670 million).

The transaction, confirmed in a stock exchange filing on Friday, is set to be finalized in June. Following the sale, Kakao’s ownership in Dunamu will decrease from 10.58% to 4.03%. The company stated that the divestment is aimed at “securing funds for future investments,” signaling a strategic pivot as the digital finance landscape continues to evolve.

Hana Bank, a subsidiary of Hana Financial Group, expressed its intent to acquire the stake to enhance its competitiveness in the rapidly growing digital finance sector. The bank has been actively expanding its footprint in the crypto space, having partnered with Crypto.com earlier this year to facilitate stablecoin payments for foreign visitors in Korea.

Kakao’s journey with Dunamu began in 2013, shortly after the company’s inception as a news aggregator. The firm transitioned into fintech in 2014 with the launch of StockPlus, followed by the introduction of Upbit in 2017. Since then, Upbit has skyrocketed in popularity, solidifying its position as Korea’s leading crypto exchange and contributing to the rise of Dunamu’s co-founders, Song Chi-hyung and Kim Hyoung-nyon, into the ranks of billionaires.

This divestment comes on the heels of a landmark merger between Dunamu and the payment arm of Naver, another major player in the Korean tech landscape. Valued at $13.6 billion, the merger is expected to create a formidable fintech entity, offering a comprehensive suite of financial services ranging from payments and insurance to crypto and securities trading.

As Kakao navigates its future investments and Hana Bank positions itself within the competitive digital finance arena, the South Korean cryptocurrency market continues to evolve, promising exciting developments for investors and consumers alike.