BitFlyer to Take Over FTX Japan in Billion Yen Deal

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As an analyst with extensive experience in the cryptocurrency industry, I am closely following the recent development between bitFlyer and FTX Japan’s acquisition. The strategic move by bitFlyer to acquire 100% of FTX Japan’s share capital is a significant step towards market consolidation in Japan’s rapidly growing crypto landscape.

In a major move for the cryptocurrency sector, bitFlyer, a prominent Japanese digital currency trading platform, is set to obtain full ownership of FTX Japan’s share capital. This previously undisclosed acquisition of the local offshoot of the internationally recognized but now defunct FTX exchange has recently come to light.

The deal’s success depends on the U.S. Bankruptcy Court giving its approval due to FTX’s ongoing legal issues. Once granted, FTX Japan will undergo a name change and shift its primary focus towards crypto custody. Leveraging bitFlyer’s strong suit in security and blockchain technology will be instrumental in this new endeavor.

[“Regarding the acquisition agreement for FTX Japan”]

— bitFlyer（ビットフライヤー） (@bitFlyer) June 20, 2024

Starting on June 19, 2024, under the terms of the purchase agreement, bitFlyer will obtain all FTX Japan shares and assume control over their business activities. The cost for this transaction is projected to exceed several billion yen.

After completing the acquisition, BitFlyer intends to institute some changes in policy. To begin with, they plan to rebrand FTX Japan as a new custodial company under a different name.

The basic policies of the New Custody Company are expected to be as follows:

  • New Custody Company will transfer FTX Japan customer accounts to bitFlyer, Inc. with the consent of the relevant customers.
  • New Custody Company will offer new crypto custody (crypto asset management) services as its core business.
  • New Custody Company will provide services related to crypto asset spot ETFs[*3], centered around its core business, if the legal system is established in the future in Japan.
  • New Custody Company will continuously maintain the crypto asset exchange service provider and Type 1 financial instruments business license depending on the situation.

The bitFlyer Group is confident that they can provide distinctive value by launching two distinct offerings: a crypto custodial service, and solutions connected to crypto asset spot Exchange-Traded Funds (ETFs), through their new subsidiary company.

BitFlyer intends to make major changes to the FTX Japan brand in an effort to restore consumer confidence as it faces ongoing legal issues. Once the acquisition is completed, the crypto community will closely watch how these developments shape Japan’s larger cryptocurrency market.

After the failure, FTX Japan encountered limitations in its operations, leading to a suspension of asset withdrawals under the instruction of Japanese financial regulators. In an attempt to restore stability, the platform searched for a potential buyer, and bitFlyer’s acquisition is viewed as a significant move toward market consolidation.

In April 2023, the number of cryptocurrency accounts in Japan surpassed 10 million – a figure that had more than tripled over the previous five years. This expansion occurred during a time of significant expansion in Japan’s crypto market. However, despite this growth, there are ongoing safety concerns for users. Simultaneously, the increasing strength of the Japanese Yen is fueling an uptick in JPY-denominated crypto trading pairs.

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2024-06-20 18:44