The South Korean fintech firm and operator of crypto exchange Upbit, Dunamu refutes claims that it made over 130 billion Korean won, over $100 million from LUNA Classic last year.
According to local media sources, Dunamu made a profit of almost USD 105 million from a 2018 investment in Luna Classic (LUNC), which was known as LUNA at the time.
Dunamu founded Dunamu & Partners in March 2018, and on April 20, 2018, purchased 20 million LUNC tokens ‘for investment purposes’ for USD 0.13 per coin.
The amount of the investment has also aroused questions as Dunamu & Partners spent two-thirds of the firm’s initial capital on the LUNC purchase.
Song Chi-hyung (Dunamu’s founder and chairman) and Kim Hyeong-nyeon (Dunamu’s Vice President) were both registered as executive directors at the moment Dunamu & Partners was founded.
Shortly before the LUNC purchase, Song Chi-hyung and Kim Hyeong-nyeon appeared to have stepped down from the company.
Upbit placed the LUNC coin on its BTC market in 2019, publicly disclosing that it held the cryptocurrency for investment purposes.
As per reports, Dunamu & Partners sold all 20 million LUNC in February 2021, netting almost $105 million.
Dunamu exchanged the LUNC coins for 2081.8500 Bitcoins on a foreign exchange at a 25% discount to the market price at the time.
Dunamu still has the exchanged Bitcoin in its possession, and did reveal the wallet addresses in the announcement.
After deducting investment costs and taxes, the firm re-appraised the unrealized profit to 41 billion won, or approximately US$33 million.
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LUNC was a notable investment at the time, according to Dunamu, and it has maintained transparency over that investment.
According to Dunamu, Dunamu & Partners’ decision to invest in LUNC was made independently, however the parent company was informed of the decision.
Amidst Dunamu’s claims that Upbit and Dunamu & Partners are two separate organizations, the media source said that insider trading concerns remained.
Right now exchanges are getting flamed over their response to the LUNA crash. A few exchanges delisted LUNA in early May, but others have yet to do so completely, resulting in a rush of speculative activity on trading platforms.
A few days back, South Korean Authorities held an emergency meeting to discuss the LUNA crash. Authorities questioned major exchanges such as Upbit which is the biggest crypto exchange in S Korea along with Bithumb, Coinone, Korbit, and Gopax.