The South Korean entertainment giant-record label of famous k-pop groups like BTS, ENHYPEN, SEVENTEEN-HYBE has officially shut down its blockchain subsidiary, Binary Korea, less than three years after its launch, citing poor financial performance.

The Seoul-based subsidiary will be dissolved and merged back into HYBE as the company reshifts its focus back into its core entertainment business, particularly artist management.

While Hybe did not acknowledge the financial troubles of Binary Korea, but it repackaged the mergers as a strategic move to enhance management efficiency

But in actually, the company was hardly making a penny, according to reports. Apparently, in 2023, the subsidiary only generated KRW 468,441 while incurring a net loss of KRW 4.28 billion.

A blockchain experiment

Binary Korea was originally an the company's efforts to expand into the world of blockchain, with the hopes of providing a novel experience for its fans by integrating entertainment and blockchain. During its primitive years, the subsidiary was constantly focusing on how it could utilise the strengths of blockchain and integrate them into the entertainment world.

Among its many collaborations was its partnership with Korean digital entertainment company Sandbox Network to create a fandom platform, named THEU.

Despite its best efforts, the entire project failed to produce results. Thus, the company has finally decided to ditch the entire idea of expanding into the blockchain industry, and putting its focus on what it does best-entertainment.

NFT expansion failure

This is not the company's first failed attempt at blockchain. Back in 2021, during the peak of the non-fungible token (NFT) popularity, HYBE also tried to try their hands in this space, only to be badly burned by the failed experiment.

After exchanging shares with crypto exchange Upbit, the two companies came together to establish joint venture Levvels in the United States, only for the enterprise to suffer losses.

Despite its bad performance, Levvels continues to run even till today. There is also reports that speculates that the joint NFT platform launched by Levvels together with Hive IP is also hardly generating any revenue for the company.

Fans weren't very amused by the company's move to venture into NFT either. Millions of fans of the HYBE's groups criticised the company for spending more time on experimenting on blockchain and NFT when they should have focused all their attention and resources on their artists.

Others have cited the environmental impact of NFT to criticise the company for venturing into this sector.

Back in September 2024, HYPE announced that Binary Korea would be partnering with one of the biggest reputable cryptocurrency company coinbase to work together on developing Binary's Onchain engagement Protocol, an innovative creator enablement platform that harnesses the power of AI and blockchain technology.

Originally set to launch in 2025, the platform would utilise the Coinbase Developer Platform and Base blockchain to "connect creators with resources needed to help facilitate payments between fans and creators."