Binance Accused of Selling Creditor Claims at a Discount: What You Need to Know
As a crypto enthusiast, it’s crucial to stay informed about the latest developments in the industry. Recently, global crypto giant Binance has come under fire for its alleged actions related to selling creditor claims at a steep discount. Here’s a breakdown of the situation:
Controversy Surrounding Binance’s Deal with Gopax
- Binance acquired a significant stake in the South Korean cryptocurrency exchange Gopax, becoming its largest shareholder.
- Gopax faced a financial crisis leading to the suspension of withdrawals by its cryptocurrency custody service, Gopay, locking up approximately 70 billion won (~ $51.5 million).
- Instead of compensating from its own funds, Binance sold the asset claims of victims at a significantly reduced price, causing concern among investors and regulators.
Binance’s Questionable Actions
- Despite promising full compensation to affected investors, Binance opted to sell their asset claims at less than half of their original value.
- This decision came shortly before a significant surge in crypto prices, leading to increased financial losses for the victims.
- The debt related to Gopax’s crisis has now escalated to around 100 billion won (~ $73.6 million), excluding any amounts already repaid.
Impact on Gopax and Investors
- Binance’s strategy has put Gopax in a challenging position, as 50% of the compensation for victims depends on Binance’s completion of the acquisition.
- In contrast, US-based Gemini exchange has begun disbursing 97% of its tied-up funds following a bankruptcy compensation plan approval.
- Gopax has remained silent on the matter, relying on the Binance Industry Recovery Fund for initial compensation payments and subsequent payments from asset claim sales.
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