FTX collapse triggers second thoughts on Busan City’s crypto exchange plans

The FTX crash seems to have affected not only businesses and investors, but entire cities that have partnered with previously troubled cryptocurrency exchanges.

South Korea’s second-largest city, Busan, is reconsidering plans to build a local cryptocurrency exchange in the wake of the collapse of FTX, local news agency Yonhap reports. report November 23rd.

The Busan government and financial authorities are becoming increasingly concerned about the concept of a public-private digital exchange amid the FTX contagion.

“Considering various circumstances, it is unreasonable for the city of Busan to promote the establishment of a digital asset exchange,” said an official from Busan.

The South Korean city has been working on setting up a local digital asset exchange for months and has signed multiple contracts with crypto exchanges. It is said that it was a pledge of Busan Mayor Park Hyung-joon.

In August 2022, the city of Busan announced a partnership with FTX, planning to build the Busan Digital Asset Exchange as part of the city’s ambition to become Asia’s digital financial hub.

After that, Busan also partnered with Huobi Global Cryptocurrency Exchange, which has a local office in South Korea since 2019. Busan in October Expansion Crypto partnership with Crypto.com exchange.

Previously, Busan also signed Memorandum of Understanding with Binance to develop a blockchain regulation-free zone in Busan to promote blockchain initiatives and businesses.

Busan officially exclusive In July 2019, it achieved the status of a regulation-free zone for blockchain technology, and plans to adopt various blockchain applications in industries such as tourism, finance, logistics, and public security. The local government has been actively pursuing its blockchain plans since late 2019, when it began working with telecoms giant His KT to develop a blockchain-based digital currency.

Related: South Korea probes crypto exchanges to list native tokens

Previously, Busan was also involved in working with local cryptocurrency wallet pioneers such as Hyundai Pay and developing blockchain-enabled virtual power plants.

According to the latest report, the city of Busan has not given up on its blockchain goals, even though it may halt its cryptocurrency exchange plans.

A local official said, “Since Busan has been designated as a region without blockchain regulations, we will explore various ways to develop Busan into a financial center.”