Dunamu, the operator of Upbit, a virtual asset exchange with the largest market share in Korea, was designated as a conglomerate group.
The Fair Trade Commission announced on the 27th that the list of companies subject to disclosure and cross-investment restrictions to be designated on the 1st of next month was announced on the 27th, and Dunamu was designated as the first among virtual asset exchange operators.
Last year, Dunamu’s total assets amounted to about 10,822.5 billion won, and customer deposits about 5,812 trillion won. As the cryptocurrency market boomed, total assets and customer deposits rose significantly.
On a consolidated basis last year, the company recorded sales of 3.746 trillion won, operating profit of 3.2 trillion won, and net profit of 2.2 trillion won. Compared to the previous year, sales increased by 1996%, operating profit by 3677%, and net profit by 4598%.
Accordingly, Dunamu was designated as a ‘business group subject to disclosure’, which applies to corporate groups with assets of 5 trillion won or more, and a ‘mutual investment restricted business group’, which applies when total assets are 10 trillion won or more.
For companies belonging to the corporate group subject to disclosure, the disclosure obligations under the Fair Trade Act, such as the resolution of large-scale insider transactions, the important matters of unlisted companies and the status of corporate groups, and the resolution of the board of directors of public interest corporations, and the prohibition of providing unfair benefits to specially related persons, etc. are applied.
For companies belonging to corporate groups with restrictions on cross-investment, other restrictions such as prohibition of cross-investment, prohibition of circular investment, prohibition of debt guarantee, and restrictions on voting rights of financial and insurance companies are additionally applied.
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The Fair Trade Commission added that Dunamu is classified as a ‘blockchain-based crypto asset trading and brokerage business’ in the information service industry under the current law. This explanation is conscious of the fact that the virtual asset industry asserts that it is not reasonable to include customer deposits in assets.
The industry has argued that, in general, deposits are not included as assets for financial companies. However, the Fair Trade Commission reported that Dunamu, a virtual asset exchange operator, is not classified as a financial insurance business under the current law, so it was incorporated as an asset and classified as a conglomerate.
