[Inside Chodong] Time for Authorities to Respond to Naver and Dunamu, Who Have Shackled Themselves with Voluntary Remedies

Borderless Battle for Digital Finance
Look Beyond Narrow Market-Share Logic to the Global Stage

As major countries, including the United States, move to bring the convergence of big tech and virtual assets into the regulatory fold, the Fair Trade Commission will hold a plenary meeting on November 18 to consider the business combination involving a comprehensive share swap between Naver Financial and Dunamu. Attention has been focused on this combination from an early stage because it represents a massive convergence of two distinct industries: traditional everyday finance and blockchain.

Over the past year, government authorities and companies have gone through a period of intense coordination to put safeguards in place in preparation for an ecosystem combining virtual assets and big tech. The Fair Trade Commission defined nearly 10 related markets, including online simplified payments, digital asset exchanges and financial MyData, and closely examined 12 types of horizontal, vertical and conglomerate combinations. In particular, it looked ahead to the yet-to-emerge market for issuing won-denominated stablecoins and assessed potential concerns about monopolies or oligopolies.

What stands out is the companies' sincere response to the authorities' review. Naver Financial and Dunamu understood market concerns that their combination could lead to the transfer of market power and took steps to address them. Rather than taking a defensive stance, they proactively submitted numerous opinion statements and actively communicated with the authorities. They also accepted the examiners' requests for revisions and supplements and submitted effective voluntary corrective measures. By agreeing to various obligations to prevent the exclusion of competitors, they demonstrated a commitment to shared growth and to ensuring a level playing field.

Past major mergers and acquisitions (M&A) approved after rigorous reviews and voluntary corrective measures offer useful precedents. Sharp criticism over the concentration of market power and the harms of monopolies and oligopolies was widespread during the acquisition of Hanwha Ocean (formerly Daewoo Shipbuilding & Marine Engineering), the integration of Korean Air and Asiana Airlines, and, further back, the combination of Hyundai Motor and Kia. But the companies themselves devised voluntary measures to promote shared growth, and the authorities responded with approval in the broader public interest. As a result, Hanwha Ocean is driving the defense industry value chain and leading a renaissance in Korea's shipbuilding industry, while the integrated airline is rescuing an ecosystem that had been on the brink of bankruptcy and is now operating smoothly. These outcomes would not have been possible if the combinations had been blocked by a narrow focus on market share.

The combination of Naver Financial and Dunamu raises hopes for a new ecosystem that breaks down the boundaries between the real economy and digital assets, allowing digital assets, including won-denominated stablecoins, to take root as everyday payment methods. It also offers a vision of tangible future finance, including hyper-personalized, integrated asset management solutions spanning traditional financial and digital assets, and commerce innovations incorporating non-fungible tokens (NFTs).

PayPal, a global giant in simplified payments, launched its own stablecoin and established it as an online and offline payment method within the regulatory framework. Shopify, the largest e-commerce platform in the United States, has also adopted stablecoins as an official payment method, actively integrating them into mainstream payment networks. As big tech companies abroad combine the real economy with virtual assets and gain an early lead in the market, we cannot afford to hold back the momentum for innovation. The Fair Trade Commission needs to make a forward-looking decision to ensure that Korea's fintech convergence ecosystem can expand freely on the global stage.

This content was produced with the assistance of AI translation services.