Exchange Korbit almost out of cash
The exchange company Korbit’s cash holding is shrinking rapidly. If they are in the red again like last year, all of the company’s cash will be gone. According to the financial audit report, it’s cash holding has decreased to 10% within two years. Of course the overall asset held by the exchange, excluding the customer deposit, also decreased. It has been steadily going down this road for a while now. Back in 2017, it’s total holding was 311.7 billion KRW and excluding the customer deposit, korbit still owned 49 billion KRW. In 2018, it was 53 billion KRW and 5.6 billion KRW, respectively. Unfortunately, the decrease continued last year. Except for the deposit from the customers (28 billion KRW), the company was only left with 1.3 billion KRW. Since 2017, the majority of cash is gone. The reason for the rapid decrease is mainly due to the poor business performance. For cryptocurrency exchange companies to make profit, the customers must deposit their asset through the exchange and use it to make transactions so that the company can collect the fees that are paid with the transaction. However, Korbit’s customer deposit went from 260 billion KRW in 2018 to 47.4 billion KRW, and finally 26.7 billion KRW last year. As the customer’s left with their money, the overall transaction amount and the profit from the transaction fees also went down. A whopping 75.4 billion KRW in transaction fees back in 2017 went down to 26.8 in 2018, and finally 3.6 billion KRW last year. If Korbit continue to go down this road and spend their assets for regular business operation, they won’t have any left. Since 2017 they lost a total of 48.7 billion KRW, not counting the customer deposit; if we don’t consider 2017, the loss is 4.3 billion KRW just last year. What they had left last year is only 1.3 billion KRW, and considering the situation hasn’t improved for Korbit it’s likely they won’t have any left soon. However, there are ways that Korbit can stop the bleeding. Korbit owns approximately 8 billion KRW worth of financial products that can be sold within a year. Additionally, the company has 3.8 billion KRW in cryptocurrency that can be withdrawn, as well as the 2.4 billion KRW in loan that they can take back. Korbit representative explained that instead of trying to get more investors, they are focusing on increasing their revenue from obtaining more customers. He said “we continue to develop new services and products to provide variety of business options” and that “we are trying to connect more with the customers.” There’s a rumor that the company is being evaluated for additional external investments based on the possibility that it might survive, however, the representative said there are “nothing to note” on that matter. https://www.blockmedia.co.kr/archives/141131 ※This article is published with the permission of Blockmedia.