Coinbase, local buyers show interest as Coinone explores partial stake sale

South Korea’s third-largest cryptocurrency exchange, Coinone, is exploring a potential partial sale of its controlling stake, drawing interest from Coinbase, the US crypto exchange giant. The discussions come amid a broader wave of consolidation in the nation’s digital asset industry. 

Chairman Cha Myung-hoon, who holds roughly 53.44% of Coinone’s shares through personal holdings and his company, The One Group, is reportedly reviewing options to sell part of that stake.

Coinone seeks to remain competitive in the rapidly expanding crypto market 

Reporters reached out to a Coinone representative for further clarity on the motive behind this sale. Responding to this request, the spokesperson disclosed that the company is in talks with major overseas exchanges and local financial institutions regarding prospective investment opportunities in the sale of shares.  However, the representative noted that no specific decisions have been finalized.

On the other hand, reports suggested that local gaming company Com2Us, the second-largest shareholder with a 38.42% stake purchased between 2021 and 2022, could play a key role in any agreement.

This sales strategy is adopted at a time when Coinone is experiencing financial strains, resulting in considerable losses lately. As a result, the firm’s book value sharply dropped to about 75.2 billion won, or rather $52.2 million, at the end of the third quarter. This figure reflects a drastic decline from its prior valuation of 94.4 billion won. 

Regarding the progress of Coinone’s motive, insiders from the company revealed that a leading, publicly traded cryptocurrency exchange, Coinbase, may participate in the sale. They also noted that executives from the US-based exchange are scheduled to visit South Korea this week. During their visit, the executives will interact with leaders from Coinone and spokespersons from other local firms.

Meanwhile, Cha, who transitioned from a cybersecurity background to entrepreneurship, has recently resumed active management duties after resigning as the company’s CEO for 4 months. This move aims to enhance the crypto exchange’s technical differentiation and operational competitiveness as the firm seeks to dominate the market.

It is worth noting that his return may be part of preparations to sell the shares or a significant deal.

Regarding his cybersecurity background, reports pointed out that the industry executive is widely known as a white hacker. Cha’s heightened interest in programming and ethical hacking prompted him to establish the crypto exchange, Coinone.

Sources still claim that the South Korea-based crypto exchange has not yet issued a public statement concerning any finalized deal. What has been revealed is that discussions are still in the preliminary phase.

Crypto exchanges look at acquisition to support operations 

South Korea’s cryptocurrency exchange industry is undergoing rapid consolidation, driven by tighter regulation and intensifying competition. Trading activity is increasingly concentrated among a handful of large platforms.

At the same time, smaller exchanges struggle to meet stringent compliance requirements. As a result, several minor operators have either exited the market or shifted focus away from retail crypto trading.

Moreover, several leading South Korean cryptocurrency exchanges have recently experienced major leadership changes. Dunamu Inc., a prominent South Korean fintech company primarily known for operating Upbit, became part of the South Korean internet giant Naver following a merger-acquisition agreement with Naver Financial, struck in November.

Another example was highlighted when reports confirmed that Binance completed the acquisition of Gopax, a prominent South Korean centralized cryptocurrency exchange. This acquisition occurred approximately 2 years after South Korean regulators approved the change in ownership.

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