PERFORMANCES BY CRYPTO EXCHANGES

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Dunamu, the operator of Korea’s largest cryptocurrency exchange, was designated a conglomerate with an asset of more than five trillion won. Meanwhile, other conglomerates performed fairly well in the first quarter but their stock prices didn’t.

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This is a cryptocurrency exchange where virtual currencies are traded in cyberspace such as on internet sites. A boom in cryptocurrency helped increase the total asset of Dunamu, the operator of Korea’s largest virtual currency exchange. Dunamu’s total assets amount to 10.8 trillion won, ranking 44th in the Korean business world. The staggering amount caused Dunamu to be classified as an enterprise with a mutual investment limit, a condition imposed only on the businesses with more than 10 trillion won in assets. This is the first time since 2017 that an enterprise was simultaneously designated a conglomerate and a group subject to mutual investment limit.

[Soundbite] Kim Jae-shin(Vice Chair, Fair Trade Commission) : "Dunamu became the first virtual asset trading group to be designated as a conglomerate."

Other local conglomerates’ first-quarter performances were also decent. SK Hynix set a record high in first-quarter revenue and S-Oil reported the highest sales and operational profit in its history. Hyundai Motor Company and Kia also enjoyed surprise earnings. But the stock market is still struggling. The Korea Composite Stock Price Index (KOSPI) fell another 1.1% yesterday, plunging 12% in total from earlier this year. The Korean stock market was likely affected by disruptions in the supply of raw materials in the wake of Russia’s invasion of Ukraine as well as the United States’ interest rate hike and inflation concerns.

[Soundbite] Kim Hak-gyun(Director, Research Center of Shinyoung Securities) : "We will see a divided world. One bloc will center around China and Russia while another one around Europe and North America. That is not a good change for a country like Korea which grew on trading."

Declining earnings for Netflix and Google may also adversely affect Korean semiconductor companies and the sales of Korean contents.