Business

Steve Kaaru

Japan’s SBI Group invests in local crypto exchange startup FXCoin

Japanese multinational financial services group SBI has invested in a local cryptocurrency exchange startup, FXCoin, a Japanese firm, revealed the investment by the Tokyo-based giant recently. The size of the investment and the stake acquired were not made public by either party according to a report by Cointelegraph Japan.

FXCoin is a cryptocurrency exchange startup founded by Tomoo Onishi, a former head of foreign exchange sales at Deutsche Bank. The startup has also managed to attract some top talent, including former executives from Mitsubishi UFJ Financial and HSBC, the world’s fifth and seventh-largest banks.

While it has been running since December 2017, it’s yet to start offering its exchange services. In February, the startup secured second tier membership with the Japan Virtual Currency Exchange Association (JVCEA). The association is a self-regulatory organization for the crypto industry in Japan. It was founded in early 2018 to establish universal operating standards for the crypto industry in the country.

With the second tier membership, FXCoin was approved to apply for a crypto exchange license with Japan’s Financial Services Agency (FSA). It’s yet to acquire the license. In the meantime, the startup has been providing market information for institutional investors.

While FXCoin forges ahead with its plans to launch a crypto exchange, another Japanese firm has halted similar plans. Money Forward Inc. revealed that it had decided to shelve its plans to launch an exchange in the near future. The company operates a personal money management and budgeting app which is wildly popular in Japan. Announcing the change of plans, the firm attributed its decision to the slowing down of the crypto market growth in the past year. Furthermore, establishing a consumer protection system that’s robust enough will be very costly given the frequent hacking attempts that crypto exchanges experience, the firm said.

With its latest investment, SBI is becoming one of the most diverse investor in the industry. Last month, the company announced that it had set up a crypto mining operation. SBI Mining Chips is being headed by an ex-NASA engineer and partners with a ‘“large semiconductor enterprise in the U.S’ which SBI didn’t disclose. SBI also partnered with Ripple to develop Money Tap, a remittance service built on Ripple’s blockchain solution.

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