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Klaytn and Finschia Merge in Attempt to Dominate Asian Web3 Market

Last Updated February 15, 2024 11:32 AM
Teuta Franjkovic
Last Updated February 15, 2024 11:32 AM

Key Takeaways

  • The merger between Klaytn and Finschia marks a significant consolidation in the Asian blockchain sector.
  • Klatyn and Finschia join forces to combine technological strengths and create a more versatile platform (EVM + CosmWasm).
  • A new token model introduces a scarcity element alongside a focus on utility across chains.

In a landmark decision announced  Thursday, the layer-1 blockchains Klaytn and Finschia have received official approval from the governance members of both foundations to merge the two networks.

This strategic move , aimed at consolidating their technologies and communities, marks a significant step forward in the blockchain industry, promising enhanced efficiency, scalability, and innovation.

Klaytn and Finschia to Merge Following Governance Approval

Klaytn, supported by South Korea’s internet behemoth Kakao, and Finschia, crafted by Japan’s messaging powerhouse LINE, have officially announced their merger. Both networks, having established their presence in Singapore, Vietnam, Taiwan, Thailand, and Abu Dhabi, are now set to unify their operations under a new banner.

Following this announcement, the two companies revealed plans to create a new foundation based in Abu Dhabi. This foundation will oversee the merger, promising a balanced leadership structure with equal representation from both Klaytn and Finschia.

Strategic Goals and Technological Synergies

The merged entity aims to launch a new blockchain mainnet that will support both Ethereum Virtual Machine (EVM) and CosmWasm, ensuring compatibility and broadening the scope for developers and users alike.

Youngsu Ko, Chairman of the Finschia Foundation Council said :

“There was no one blockchain network that represented the Asian market, and the level of community participation had much to be desired. We plan to build Asia’s largest blockchain ecosystem with the diverse opinions from our partners and community that we gathered during the merger proposal process.”

Sam Seo, Representative Director at Klaytn Foundation, highlighted  the positive outcomes of engaging in earnest conversations with ecosystem participants, including the holder community and governance council members, throughout the merger proposal refinement. He emphasized  their collective goal to establish Asia’s premier blockchain ecosystem, aimed at generating substantial future value.

New Unified Coin to Replace KLAY and FNSA in Merger

In the wake of the merger between Klaytn and Finschia, the native cryptocurrencies of the two blockchains, KLAY and FNSA, will be phased out in favor of a newly issued coin. This coin will represent the aggregate total of KLAY and FNSA currently in circulation.

Holders of the existing cryptocurrencies will have the opportunity to exchange their holdings for the new coin as soon as it becomes available. In a significant move towards Zero Reserve Tokenomics, 24% of the newly issued coins, primarily constituting the non-circulating supply of KLAY, are slated for destruction.

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