Dunamu operates Upbit, South Korea’s largest crypto exchange by daily trading volume.
SeongJoon Cho/Bloomberg
South Korean internet giant Kakao is partially exiting its early investment in crypto exchange operator Dunamu, selling a stake worth 1 trillion won ($670 million) to domestic commercial bank Hana Bank.
Kakao said in a stock exchange filing on Friday that its investment arm, Kakao Investment, will sell a 6.55% stake in Dunamu. Hana Bank, a subsidiary of Hana Financial Group, will buy the stake in cash, the Korean banking giant said in a separate filing. The deal is set to be completed in June.
Following the transaction, Kakao’s stake in Dunamu will decrease to 4.03% from 10.58%. The company said the share sale is aimed at “securing funds for future investments.” Hana Bank, meanwhile, said it invests in Dunamu to “secure competitiveness in new finance.” The lender has been expanding into digital assets, partnering with crypto exchange Crypto.com in March to promote stablecoin payments for foreign visitors in Korea.
Kakao, controlled by billionaire Kim Beom-su, first invested in Dunamu in 2013, a year after the Seoul-based company was founded. At the time, Dunamu was a news aggregator. It pivoted to fintech in 2014 with the launch of stock trading platform StockPlus, then crypto exchange Upbit in 2017. Since then, Upbit has grown to become Korea’s largest crypto exchange by daily trading volume. The success of Upbit has propelled Dunamu’s cofounders Song Chi-hyung and Kim Hyoung-nyon into the world’s billionaire ranks.
Kakao’s divestment comes on the heels of Dunamu’s landmark merger with the payment arm of Korean search giant Naver. The merger, set to be completed in June, values the combined entity at $13.6 billion. It’s poised to create a domestic fintech juggernaut offering a slew of financial services from payments and insurance to crypto and securities trading.