BTS agency teams up with Korean crypto exchange to venture into NFT market

K-pop sensation BTS (Big Hit Music)

Hybe, the K-pop powerhouse behind BTS, said Thursday that it has teamed up with South Korea’s top cryptocurrency exchange operator to establish a joint venture to branch out into the nonfungible token marketplace.

The music agency is poised to acquire a 2.48 percent stake in Dunamu for 500 billion won ($423.7 million), as the operator of cryptocurrency exchange Upbit plans to issue 861,004 ordinary shares for third-party rights, offering to invite Hybe as a new shareholder.

Dunamu also looks to buy some 2.3 million ordinary shares of the K-pop agency for about 700 billion won, which would make it a minority shareholder of Hybe with 5.57 percent ownership. The payment is set to be completed on Nov. 24, officials said.

The move will see plans to jointly push ahead with a new business using NFT, a unit of blockchain data that represents ownership of a unique digital item, as part of efforts to roll out the music agency artists’ unique goods for fans around the world.

During an online corporate briefing Thursday, Hybe founder and Chairman Bang Si-hyuk demonstrated how NFT-based products can be made by taking artists’ photo cards as an example. The NFT would enable the company to create digital photo cards with various contents, including moving images and voices of the artists, Bang explained. 

Hybe founder and Chairman Bang Si-hyuk (left) and Dunamu Chairman Song Chi-hyung speak during an online corporate briefing on Thursday. (Hybe)

“We are under talks to shape up the detailed action plan with Dunamu on how to provide secure photo card ownerships and allow fans to possess them permanently. They would enjoy diverse experience by collecting, exchanging and displaying the cards through global fan communities such as Weverse, instead of having a single photo,” Bang said.

Hybe earlier had denied rumors of a partnership with Dunamu for the NFT business and issuance of 400 billion-won worth of convertible bonds. Instead, the two companies refused to provide any details besides saying that “nothing has been decided yet.”

With NFTs exploding in popularity, market observers have painted a rosy outlook for Hybe, forecasting that the new NFT business will likely play a role as a mid to long-term growth engine.

“The NFT business is expected to maximize the company’s intellectual properties. Investors are recommended to focus on the entertainment agency creating innovative and differentiated values by combining its existing entertainment business with information technology,” said Lee Hwan-wook, an analyst at IBK Securities.

As the K-pop powerhouse unveiled its new business plan, shares of Hybe advanced 2.89 percent to 356,500 won as of 2:00 p.m. The stock once reached 372,500 won in late morning trade, the highest level since its market debut on Oct. 15 last year.

By Jie Ye-eun (yeeun@heraldcorp.com)

BTS agency teams up with Korean crypto exchange to venture into NFT market
Philippines Truth