Anna Jiwon Park has been covering the politics at The Korea Times since the summer of 2024, when she joined the press pool for the Office of the President in Korea. Prior to that, she spent about five years reporting extensively on financial markets, regulatory authorities and the financial industry. She joined The Korea Times in 2019 after spending eight years as a broadcast journalist at Arirang TV, Korea’s leading global broadcaster, covering politics, defense and culture.
Hanwha's Dunamu equity acquisition gets chilling reaction
Hanwha Investment & Securities headquarters on Yeouido, Seoul. / Courtesy of Hanwha Investment & Securities
By Anna J. Park
By Anna J. Park
The stock price of Hanwha Investment & Securities remains bearish since the brokerage firm announced Wednesday afternoon that it acquired about 207 million shares, or a six percent stake, in Korean crypto fintech Dunamu.
Hanwha Investment's stock price finished at 2,790 won ($2.49) at Wednesday's closing, a 9.12 percent fall from the previous session.
Despite the stock price's steep rise earlier this week, seeing 4.58 percent and 12.04 percent jumps respectively on Monday and Tuesday's closings, the stock price plummeted immediately after the equity acquisition announcement was made on Wednesday afternoon. The stock price, that rose as high as 3,370 won at 1:45 p.m. Wednesday, nosedived after the announcement, to less than 2,800 won in just a minute.
On Thursday's session, the stock price of the brokerage firm continued its bearish moves, losing another 3.76 percent, finishing at 2,685 won at closing.
Such discouraging moves of the price seem to reflect investors' concerns about whether the equity acquisition deal would yield a stable profit structure for the firm, as Dunamu's fintech business is centered on its cryptocurrency platform, Upbit. Upbit is one of the most frequently used mobile-based cryptocurrency exchanges in Korea, yet the highly volatile nature of cryptocurrency could be both a risk and boon factor for the brokerage firm.
With the equity acquisition worth 58.3 billion won, Hanwha Investment has become the seventh-largest shareholder of Dunamu, which operates mobile-based cryptocurrency exchange Upbit, as well as unlisted stock trading platform Stock Plus. Hanwha took over the entire amount of Dunamu equities held by Qualcomm.
Regarding such concerns, Hanwha Investment said the equity acquisition was based on the firm's long-term strategy to strengthen its digital capacity. The firm explained that it had previously invested in other innovative fintech companies, like PayCo and Toss, and that Dunamu's stake acquisition is also the part of the firm's long-term vision.
“The investment decision was not based on the cryptocurrency boom itself. It was decided as Dunamu holds blockchain technology, which shows the firm's ample growth potential in the accelerated digital era amid the COVID-19 pandemic,” an official from Hanwha Investment said.