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The possible acquisition of Bithumb by FTX could mark one of the exchange’s first attempts to directly connect with the South Korean crypto ecosystem.
FTX derivatives exchange is in advanced talks to buy Bithumb, one of the few licensed exchanges to operate in South Korea as stakeholders in the broader digital currency explore avenues to position their businesses for opportunities beyond the current crypto winter.
As reported by Bloomberg, citing a source familiar with the negotiations, the discussion between FTX and Bithumb has been ongoing for several weeks now, however, a Bithumb spokesperson said the trading platform “cannot confirm anything at this stage.”
FTX Derivatives Exchange, co-founded by Sam Bankman-Fried has been very active in the Mergers and Acquisition (M&A) scene in the past few years. As one of the most bankrolled companies in the cryptocurrency ecosystem at this time, the digital currency exchange has been a major backbone to many distressed firms this crypto winter.
FTX Derivatives Exchange has been particularly involved in helping crypto lender, BlockFi survive the onslaught it faced through targeted loans and the possibility of acquisition. BlockFi comes off as one of the most distressed firms, but the bailout from FTX has shifted it away from declaring bankruptcy when compared to the likes of Celsius Network.
The Sam Bankman-Fried-led company has also extended about half a billion dollars worth of line of credit through its subsidiary Alameda Ventures to crypto platform Voyager Digital. The line of credit was to enable the company, which has also now filed for bankruptcy to cope with the $650 million loan default by a liquidated hedge fund, Three Arrows Capital (3AC).
The cataclysm of events amongst prominent crypto firms is a concern that FTX had been doing all it can to help put an end to. While it is reported that the trading platform has more firms it has backed that are yet to be announced, a recent report highlighted both FTX global and FTX.US are exploring new avenues to raise funds in order to continue their M&A activities.
Point of Interest of FTX in Bithumb
Should the Bloomberg report about the proposed acquisition of Bithumb by FTX be confirmed, it will mark one of the exchange’s first attempts to directly connect with the South Korean crypto ecosystem.
While not the biggest trading platform in the country, Bithumb is one of the most renowned exchange platforms in Korea, and as a major player, it was one of the platforms that was raided by the authorities investigating the Terra-LUNA crash back in May.
In reality, Bithumb has been in the crosshairs of the authorities in the past few years but has done the best it could to absolve itself of all misdemeanors. The attraction of Bithumb to FTX might also lie in the fact that the exchange was one of the few that is fully licensed by all relevant authorities in the country. Based on this, FTX can have an easy entry into the country if the acquisition eventually pulls through.