One short month after Japan started recognizing Bitcoin as a method of payment, more than ten new companies in the country are reportedly applying to become bitcoin exchanges. Meanwhile, institutional investors are increasingly gaining interest in the digital currency.
Japan Ripe for Bitcoin Exchange Business
On April 1, Japan officially began recognizing Bitcoin as a method of payment. A week later, some major retailers announced their plans to accept the digital currency. Bic Camera, using the payment system provided by the world’s largest bitcoin exchange by volume, Bitflyer, started accepting bitcoin at two of its stores on April 7. Meanwhile, bitcoin exchange Coincheck has partnered with Recruit Lifestyle to bring bitcoin payments to over 260,000 stores by this summer.
In addition, the Japanese government has announced that starting in July consumption tax will no longer apply to the sales and purchases of bitcoin.
Soon, more than 10 new companies will be entering the space for the first time, Nikkei Asian Review reports on Tuesday, citing that the new regulations require bitcoin exchanges in Japan to obtain a special license. The Japan Cryptocurrency Business Association told the publication that approximately 18 businesses are planning to apply for a license, including existing exchanges such as Bitflyer as well.
Big Players Entering the Race
Some major corporations are also entering the race to become bitcoin exchanges, Nikkei details. They include SBI Holidings, GMO Internet Group, Kabi.com Securities and Money Partners Group.
Last October, SBI Holidings announced that it was launching a bitcoin exchange called “SBI Virtual Currencies.” The company explained at the time that this platform would provide digital currency exchange and trading services for SBI group companies.
In January, Japan’s leading provider of Internet services GMO Internet Group announced its plan to develop a bitcoin exchange and wallet service. The group is “establishing its own company [bitcoin exchange], with plans to increase the number of digital currencies it trades based on demand,” Nikkei confirms this week.
Two other companies planning to enter the field are Kabu.com Securities and foreign exchange trader Money Partners Group. Kabu.com Securities is the only dedicated online securities company within the Mitsubishi UFJ Financial Group (MUFG) Group. Money Partner Group is one of Japan’s leading foreign exchange brokerage firms. In April 2016, the company invested in San Francisco-based bitcoin exchange Kraken.
Demand from Institutional Investors
“Many new players are interested in turning such currencies into a new investment option,” Nikkei wrote, adding that a source at one company told them that “there is demand among our clients for cryptocurrencies, given their rising value.”
Brian Kelly Capital is an investment management firm catering to institutional investors and high net worth individuals. “I don’t think this is hot money. This is real money that’s going to sit around and build the new internet,” the firm’s founder Brian Kelly said, citing his conversations with institutions and other investors. He shares:
The biggest driver right now is you’re starting to see institutional investors take a keen interest in the entire sector.
Do you think Japan will lead worldwide Bitcoin adoption? Let us know in the comments section below.
Images courtesy of Shutterstock, SBI Holdings, and GMO Internet Group