Industry insiders in South Korea and Japan are talking up the potential blockchain “synergy” that may materialize from the proposed Line and Yahoo Japan merger – after the tech giants’ operators agreed on a deal in principle.
Yahoo Japan operator SoftBank has released details of its agreement with Line and Naver, the company that founded the popular chat app.
Per the terms of the agreement, fintech will be a core business area, and – should shareholders green-light the deal – the operators will merge Line and Yahoo Japan to create a 50-50% owned company. Financial regulators in Japan would also need to grant their approval.
According to Dong-A, the new company will initially focus on mobile pay solutions – with a possible PayPay and Line Pay collaboration possible.
Yahoo Japan has already integrated Ripple’s MoneyTap app into its PayPay mobile-based e-pay operations, while many believe that Line has been working on a way to link its cryptocurrency and blockchain operations to Line Pay.
Dong-A believes that Naver’s senior management feels that urgent action is needed if South Korean and Japanese tech companies want to compete against China’s fast-expanding BATH tech giants: Baidu, Alibaba, Tencent and Huawei.
Per Edaily, a researcher at NH Investment & Securities, one of the largest securities firms in South Korea, pointed out that Naver and Line already have Japan’s number 1 chat app and South Korea’s leading search engine.
Adding the 50 million-user Yahoo Japan platform to the business equation could help the companies compete on a global scale.
Mira Kim, a South Korean blockchain consultant, told Cryptonews.com,
“Remember that chat app Kakao’s merger with search engine Daum back in 2014 proved to be a success, and Kakao followed up that merger with a lot of crypto and blockchain-related activity. Perhaps there is a precedent here.”
Fn News, meanwhile, quotes experts who believe that blockchain technology will be the new company’s “secret weapon,” and states that breaking Japan’s reliance on cash as an alternative to expensive credit card transactions will be a priority – using cryptocurrency and blockchain technology.
The same media outlet quotes an unnamed industry insider as stating, “SoftBank has been steadily building up a portfolio of blockchain and cryptocurrency interests.”
As well as the Japanese TaoTao exchange, which Yahoo Japan owns a controlling stake in, the insider was quick to point out links between Softbank and the unicorn exchange Liquid by Quione. The younger brother of Softbank’s CEO is a major investor in Liquid, and a number of the exchange operator’s senior executives are former Softbank decision-makers.