How Will Binance’s Non-Compliance With US Laws Impact Gopax?

According to the latest reports, the South Korean crypto exchange Gopax has been adversely impacted by the recent revelations of Binance’s non-compliance with the anti-money laundering rules.

Gopax finds itself caught in a crisis following Binance’s regulatory struggles and its final decision to completely withdraw from the U.S. crypto market. There are speculations that there will be restrictions for Gopax to enter the domestic market.

Earlier this year, Binance, in an attempt to re-enter the South Korean crypto market, acquired a majority stake in Gopax. Binance’s acquisition bid has been under scrutiny by the Financial Services Commission (FSC) of South Korea, considering the U.S. Securities and Exchange Commission’s (SEC) lawsuit against the exchange. While the business change report submitted by the exchange was delayed, a South Korean journalist, Hong Hong-young, suspected even the cancellation of the bid.

Following the recent incidents that unfolded Binance’s security breaches, analyst Jeong Hye-won commented on its possible impacts on Gopax. Elaborating on the cause of the delayed acceptance of business change, the analyst cited:

If it is due to the judicial risk, that was a cause for concern about Binance’s expansion into the domestic market. It can be understood as a green light, but if there are concerns about the inflow of Binance capital into the country, the impact of this incident will be small.

Korbit Research Centre Head Jeong Seok-moon stated, “With Binance CEO Changpeng Zhao resigning, I think another justification (problem of major shareholder eligibility) has been created for the domestic financial authorities to not approve Gopax.”