Korean bitcoin exchange Korbit has raised $3 million in Series A funding led by SoftBank Ventures, Pantera Capital, and BAM Ventures. Returning investors such as Bitcoin Opportunity Corp., Tim Draper, Pietro Dova, and Strong Ventures, also made additional investments for Korbit. The investment is a positive signal for bitcoin prospects in Korea, especially knowing that Korbit has only been operating just over a year.
“Although the price of bitcoins this year decreased compared to last year, the decrease does not necessarily mean that the bitcoin industry is failing in Korea,” said KiHong Bae, one of the investors from Strong Ventures.
“South Korea has a booming e-commerce market and was an early adopter of virtual goods. The government supports innovation and even the banking industry is actively investing in Korbit.” Dan Morehead, CEO of Pantera Capital, also expressed his optimistic view.
Korbit offers services that are localized specifically for the Korean market. It currently services Bitcoin Wallet to approximately 25,000 users and merchant processing services to 400 clients’ accounts with Korbit Pay. It also launched the first bitcointo Korean Won exchange service last April. Korbit charges a one percent fee for merchants who want their incoming bitcoin payments converted to fiat currency.
“The bitcoin exchange market is pretty healthy in Korea,” said Tony Lyu, the CEO of Korbit. “The use of bitcoins in commerce is just starting to pick up, through the introduction of merchant processing services such as Korbit Pay. Bitcoins can drastically improve online payments experiences for Koreans, because currently online payments are not user-friendly due to antiquated regulations.”
The future of bitcoins in Korea has many remaining challenges. Yet, Korbit investors believe that the commercialization of bitcoins should happen sooner than what people speculate because of the many advantages it offers. “Bitcoins can replace what financial brokers traditionally do. Compared to cash and credit card, the price and the accessibility of bitcoins are more competitive. We expect our market to expand as more people use bitcoins to transfer money both domestically and internationally. We also expect some of the business transactions such as electronic contracts and M2M (Machine-to-Machine) transactions to be take place with bitcoins” said KangJun Lee from Soft Bank Venture.