Bithumb's Valuation Soars Amid Interest from Financial Firms

Bithumb's valuation is rapidly increasing as it remains the last major cryptocurrency exchange available for investment amid a wave of mergers and partnerships between exchanges and securities firms. Financial institutions are particularly interested in Bithumb due to its second-place market position, which offers potential access to stablecoin operations and corporate clients.

According to financial industry sources on June 30, multiple financial firms have been in discussions with Bithumb representatives regarding investment opportunities.

Major securities firms, including Kiwoom Securities, as well as banks, are reportedly continuing behind-the-scenes negotiations. Bithumb has a partnership with KB Kookmin Bank for account services, leading some to speculate that this collaboration could expand into investment. A financial industry source stated, "Several banks are internally reviewing investments and collaborations with cryptocurrency exchanges."

Recent alliances have formed, such as Hana Financial Group with Dunamu, Korea Investment & Securities with Coinone, Mirae Asset Securities with Korbit, and Binance with Gopax, leaving Bithumb as the only major exchange without investment. This has prompted increased interest from financial firms seeking to secure a stake in Bithumb.

Despite facing various risks, Bithumb's retail market share remains significant, estimated at around 30%, which is half of the leading exchange, Upbit. However, it has established a considerable gap over exchanges ranked third to fifth, which have single-digit market shares, solidifying its second-place position. Analysts believe that once the risks subside, Bithumb could be a valuable asset due to its potential for economies of scale.

Financial firms are also recognizing the need for exchanges to secure future revenue streams. If the digital asset legislation discussions resume in the second half of this year, banks will gain the authority to issue stablecoins. Partnering with an exchange could provide them with a competitive edge in distribution.

Furthermore, there are opportunities for extensive collaboration, ranging from establishing a Korean won stablecoin ecosystem for issuance, distribution, and payment, to jointly entering overseas digital asset markets and developing wealth management services based on digital assets, including funds, pensions, and trusts. For financial firms facing limitations in traditional profit structures based on interest margins, this presents a chance to accelerate the expansion of new business ventures.

Institutional clients could also be attracted to Bithumb. Regulatory authorities are considering allowing corporate investments in virtual assets, which is expected to lead to significant inflows of institutional capital. Financial firms allied with cryptocurrency exchanges may find it easier to connect institutional clients to their platforms.

A financial industry source noted, "Due to major shareholder equity restrictions, most exchanges do not have additional shares available for financial firms to acquire. Selling shares would be advantageous for Bithumb to ensure transparency in its governance structure and to pursue an initial public offering (IPO)."