Naver's Crypto Merger Nears Final Approval Amid Regulatory and Valuation Challenges

Naver Corp. is poised to finalize its acquisition of Dunamu Inc., the operator of South Korea's largest cryptocurrency exchange Upbit, according to industry sources during board meetings scheduled for November 26. The move, facilitated through Naver's fintech subsidiary Naver Financial, will involve a full equity swap to make Dunamu a wholly owned subsidiary, signaling a strategic push into digital finance and crypto markets. The integration is expected to include the launch of a South Korean won-backed stablecoin and other digital finance initiatives, potentially reshaping the country's financial landscape.

The equity swap structure has drawn attention for its implications on shareholder dynamics. Dunamu Chairman Song Chi-hyung is projected to become the largest shareholder in the merged entity with a 28% stake, while Naver's ownership will be diluted to 17%. Industry estimates suggest the share-swap ratio will range between 1:3 and 1:4, valuing Dunamu at approximately 15 trillion won and Naver Financial at 5 trillion won. However, Mirae Asset Securities, a 30% stakeholder in Naver Financial, has expressed concerns over the valuation, noting that Kakao Pay's market cap of 7 trillion won makes the assessment "conservative".

Regulatory scrutiny remains a potential hurdle. While authorities have deemed the merger compliant with financial regulations separating virtual assets from traditional finance, antitrust concerns loom, especially given Upbit's dominant 50.6% market share in Q3 2025. The merger also follows a shift in market dynamics, with Bithumb's domestic share rising to 46% and partnerships with U.S.-based crypto ventures intensifying competition.

Naver's expansion extends beyond South Korea. Just days before the anticipated board votes, Naver Chairman Lee Hae-jin met with Saudi Minister Majed Al-Hogail to discuss stablecoin projects and AI data centers, aligning with Saudi Vision 2030 goals. The collaboration could leverage Saudi Arabia's real estate assets through security token offerings or real-asset-backed stablecoins, positioning the kingdom as a key partner in Naver's global fintech ambitions.

The acquisition, if approved, would merge Naver Financial's 80 trillion won ($58 billion) annual payment volume with Upbit's global trading volume, creating one of the most formidable tech-crypto alliances. The combined entity aims to launch a stablecoin integrated into Naver Pay, with plans to expand into international markets potentially reshaping financial ecosystems.