Core Insights - Dunamu and Naver Financial are merging to create a financial entity valued at approximately $13.8 billion (20 trillion won) [1] - The merger is expected to pursue a Nasdaq listing, potentially increasing the valuation to at least $34.5 billion (50 trillion won) if it successfully attracts global investor interest [2] - The merger aims to enhance both companies' positions in the stablecoin market, with Dunamu planning a won-backed stablecoin and leveraging Naver Pay as the lead issuer [5][6] Company Details - The merger involves a stock swap where Dunamu shareholders will exchange their shares for Naver Financial stock at an estimated ratio of 1:3.3 to 3.4, making Dunamu a wholly owned subsidiary of Naver [3] - Post-merger, Naver's ownership stake will decrease from 69% to 17%, while Dunamu will delegate more than half of its voting rights to Naver to comply with monopoly regulations [4] - Dunamu's Chairman and Vice Chairman will become the largest shareholders of the combined entity, holding nearly 30% ownership [3] Strategic Implications - The merger is driven by ambitions in the stablecoin market, with both companies aiming to leverage their strengths to achieve broader circulation of their products [5][6] - Naver Group has been looking to advance in the payments sector, and the merger is seen as a strategic move to enhance its capabilities in this area [6] - The sentiment in the prediction market indicates low confidence that stablecoins will exceed $360 billion before February, with only a 12.3% chance assigned to this outcome [6]

Group 1 - Naver Corporation is in discussions with Dunamu regarding a potential share swap that could integrate Upbit into Naver's financial ecosystem [1][2] - Following the news, Naver's shares increased by as much as 11.4% [1] - The proposed deal would position Dunamu as a subsidiary of Naver Financial, enhancing Naver's control over Upbit and its presence in the crypto market [2][6] Group 2 - Naver has filed a disclosure with the Korea Exchange, indicating ongoing discussions about various forms of cooperation with Dunamu, including a share exchange and projects related to stablecoins and unlisted stock trading [3] - The partnership builds on a previously announced collaboration in July, where Naver Pay and Dunamu planned to issue a KRW stablecoin, marking a significant step in the South Korean stablecoin landscape [4] - Dunamu is developing a custom Ethereum layer-2 blockchain named "GIWA" to support stablecoins and payment infrastructure [4][5] Group 3 - If the share swap is finalized, Naver would become the first major South Korean platform to fully integrate a cryptocurrency exchange into its financial services, potentially enhancing cross-selling opportunities and stablecoin adoption [6]

Core Insights - Upbit, Korea's largest crypto exchange, is reportedly launching GIWA, a Layer-2 chain on Ethereum, with trademark applications already filed by its parent company Dunamu [1][2] - The launch of GIWA positions Upbit to compete with Binance's BNB Chain and Coinbase's Base Network, enhancing its dominance in the Asian crypto market [2][3] - The GIWA L2 launch is expected to facilitate the development of decentralized financial applications tailored for both local and global markets [3] Market Dynamics - Upbit currently holds over 80% of daily crypto trading volume in Korea, while Coinbase leads the US institutional market as custodian for 9 of the 11 active US crypto ETFs [2] - There is a notable increase in Bitcoin demand in Asia, particularly in Korea, as traders seek safe-haven assets amid escalating US-China trade disputes [6][7] - The BTC Korean Premium Index has risen by 130% since July 14, indicating heightened demand for Bitcoin within Korea compared to global markets [7] Broader Economic Context - The trend of global de-dollarization and increased gold holdings by foreign central banks, including China, is influencing the crypto market landscape [4][5] - Upbit's commitment to the GIWA Layer 2 launch could further drive cryptocurrency adoption in Asian markets, especially as capital flows away from US Treasury assets [4][8]