Japan's prime brokers are competing for market share with crypto-native exchanges
According to a study by Messari, the top three online brokerage firms in Japan are seeing increasing sales of their cryptocurrency exchange services.
In his report on the Asian crypto landscape, Messari noted that the operating revenues and net worth of the exchange platforms operated by Japan's leading securities brokers are fast matching those of their crypto-native competitors.
Comparing Assets and Operating Income Between Exchanges Run By Crypto Native Firms And Online Stock Brokers In Japan, Aug 2020: Messari
Messari researcher Mira Christanto tweeted that Japan's three largest brokers by customer deposits – SBI, Rakuten, and Monex – operate crypto-exchange platforms.
Christanto also noted that many large asset managers are encouraging Japanese lawmakers to offer advanced cryptocurrency services and products such as custody solutions and exchange-traded funds.
“Big asset management funds are campaigning for the government to allow custody and ETFs. If they get the green light, the banks will be waiting on the sidelines to join in. "
The report commends Japan's top financial regulator, the Financial Services Agency [FSA], for longstanding support for inclusive crypto regulations and establishes the island nation as a regional hub for the digital assets industry.
Messari identified 26 digital currency exchange licenses that have been issued since regulation in April 2017. BitFlyer is currently the largest Japanese exchange with over $ 1 billion in assets under custody and a net worth of $ 146 million as of August 2020 research.
Additionally, Japan's institutional-grade Liquid Exchange was included in the top ten crypto unicorns list by the end of 2019 – with a valuation of more than $ 1 billion.
The report also notes that a large number of high profile mergers and investments have taken place in the Japanese crypto industry.
In April 2018, the large exchange Coincheck was taken over by the online broker Monex Group. In October 2019, the Financial Products Group, a publicly traded financial services company, invested in Huobi Japan.