"Naver·Dunamu synergy substantial… If realized, 'big deal'"

Analysts say the impact on the industry would be considerable if Naver were to acquire Dunamu, operator of South Korea's No.1 virtual asset exchange Upbit.

Domestic Web3 research firm Tiger Research said in a report on the 25th that "the possibility has been raised that Dunamu, the operator of Upbit, could be incorporated into a Naver affiliate," adding, "this would be a big deal on the level of global big tech Google acquiring Coinbase, the representative exchange of the virtual asset industry." Tiger Research said, "The core is the synergy between the two companies," and added, "(the two companies) are already cooperating in several areas such as stablecoins, and it is highly likely that some form of merger will be concretized."

Tiger Research said the user base of Upbit would expand significantly if the acquisition is completed. Tiger Research analyzed, "Currently, the process of joining a virtual asset exchange is quite complex, but if Naver is linked with Upbit, the situation would be completely different," adding, "simple sign-up and login based on Naver ID would become possible, and identity verification (KYC) processes could be greatly simplified using Naver Mobile ID." It added, "If Naver's base of 40 million users is combined with an easy sign-up process (with Upbit), the inflow of potential users would be much easier," and, "For Upbit, this is an opportunity to greatly accelerate user expansion."

The firm also said the synergy in the stablecoin sector would be large. Tiger Research said, "Naver has formalized its intention to enter the stablecoin market and is likely to issue stablecoins centered on Giwa Chain," adding, "If stablecoins are introduced into Naver's large-scale payment ecosystem, significant synergy is expected for both companies." It went on, "Naver could reduce existing card company fees to improve profitability and greatly enhance the efficiency of settlement processes," and, "Dunamu could secure blockchain fees generated on Giwa Chain as well as transaction fees arising from stablecoin payment businesses."

The companies' existing infrastructure is also noteworthy. Tiger Research said, "In a situation where the use of stablecoins or crypto payment methods has not yet become widespread, on·off ramps are essential for operators to cash out after receiving stablecoins," adding, "exchange infrastructure is needed in this process, and Upbit is judged to play that role." Tiger Research analyzed, "If Naver Pay and Upbit are connected as one, they will have completely different competitiveness," and, "They would provide a competitive advantage on a level different from existing payment ecosystems."