A South Korean lawmaker is pressing the Financial Services Commission (FSC) to hold Binance accountable for fully compensating users of the GOPAX exchange. Democratic Party lawmaker Min Byeong-deok raised the issue during a National Assembly audit, questioning FSC Chairman Lee Eog-weon about the incomplete repayments following GOPAX’s service disruption.
The core issue stems from GOPAX’s exposure to the bankrupt U.S. firm Genesis Global Capital, which froze user funds. Min estimates the outstanding damages range from 10 billion to 50 billion won (approx. $7.2 million to $36.2 million).
Lawmaker Questions Binance Deal Structure
Min Byeong-deok highlighted that Binance’s acquisition of GOPAX included an agreement to make affected users whole. However, he characterized the deal as potentially a “no-cash” merger and urged the FSC to ensure Binance fulfills its commitment now that the takeover is approved.
The lawmaker emphasized the need for regulatory action to bring the compensation process to a proper conclusion.
Related: Binance Nears Korea Return as FIU Review of GOPAX Deal Points to Year End Approval
Binance Clears Final Hurdle for South Korea Return
The pressure on compensation comes shortly after South Korea’s Financial Intelligence Unit (FIU) granted final approval for Binance to acquire GOPAX. This decision officially marks Binance’s return to the South Korean market, which it exited in 2021 due to regulatory challenges.
The FIU’s approval followed months of delays and rigorous reviews focusing on anti-money laundering (AML) and compliance protocols. Binance initially secured a majority stake (reportedly 67%) in GOPAX back in February 2023 but faced prolonged regulatory scrutiny.
The approval allows Binance to integrate its global trading infrastructure with GOPAX, operating under South Korea’s strict framework requiring verified user accounts and real-name banking.
Status of GOPAX User Repayments
GOPAX’s operational issues began in late 2022 when its yield product partner, Genesis Global Capital, halted withdrawals following the FTX collapse. This froze an estimated $47 million in GOPAX customer funds parked in the ‘GoFi’ service.
Binance’s intervention was positioned as a rescue plan to stabilize GOPAX and restore user access to funds. The acquisition agreement reportedly involved Binance injecting capital and using recovered Genesis assets to repay users.
While reports suggest around $70 million has been distributed, the full compensation remains pending, awaiting the conclusion of Genesis recovery proceedings. Lawmaker Min’s intervention aims to ensure regulators enforce the completion of these payments.
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