Daiwa Securities CEO pushes for Japan crypto ETF approval amidst slumping China profits

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As a seasoned investor with over two decades of experience in the financial market, I find the recent developments in Japan’s crypto landscape intriguing. The push for crypto Exchange-Traded Funds (ETFs) by Daiwa Securities and other major Japanese financial firms is a promising sign, indicating a potential shift in the regulatory environment towards greater acceptance of digital assets.

As a researcher, I personally advocate for Japan’s consideration in permitting the introduction of cryptocurrency exchange-traded funds (ETFs) into its domestic market. Being part of the financial sector, my company, Daiwa Securities, is among several entities advocating for this approval, recognizing the potential benefits that crypto ETFs could bring to the Japanese financial landscape.

Based on a Bloomberg article released on December 24th, Akihiko Ogino, CEO of Japan’s second-largest brokerage, suggested in an interview that it would be beneficial for Japan to introduce crypto Exchange Traded Funds (ETFs) within their borders.

As a researcher, I’m currently observing that at the point of my writing, Daiwa already has an index-based exchange-traded fund listed in the Japanese market, known as the Daiwa ETF Nikkei 225. However, Ogino has not disclosed any intentions for Daiwa to initiate the filing process for a crypto-backed ETF at this time.

Besides Daiwa, other significant financial firms in Japan, including Mitsubishi UFJ, Sumitomo Mitsui, and Nomura Securities, have also shown interest in cryptocurrency Exchange Traded Funds (ETFs). Last October, they collectively proposed to the Japanese government, suggesting that Bitcoin (BTC) and Ethereum (ETH) be given priority for crypto-backed ETFs.

Nonetheless, some argue that it remains challenging for Japan to adopt cryptocurrency exchange-traded funds (ETFs) given the regulatory limitations and lingering negativity surrounding cryptocurrencies stemming from previous events like Mt. Gox and DMM.

Furthermore, Ogino anticipates that Japan’s central bank may continue to tighten its monetary policy, given the rising corporate profits and early indicators of inflation.

Daiwa anticipates that the Bank of Japan will boost the country’s policy interest rate by 0.25 percentage points in January of the following year, taking it from 0.25% to 0.5%. Furthermore, the brokerage predicts another increase by the end of 2025, bringing the rate up to 0.75%.

Following the Bank of Japan’s decrease in Japanese government bond buying, Ogino suggested that “there will be more bonds up for trade, potentially sparking increased market activity.

Presently, Daiwa is struggling to generate profits within its China market. Ogino expressed some doubts about whether the brokerage can secure profits in the upcoming year. As a result, they are investigating strategies to ensure profitability by 2026.

Ogino notes that, contrary to expectations, the speed at which the Chinese market has developed over the past year hasn’t been particularly impressive.

Based on reported figures, the collective earnings from Chinese securities companies decreased by approximately 9% to reach around 203.3 billion yuan ($27.9 billion) during the initial six months of the current year when compared to the same period last year.

Moreover, the company has announced plans to increase employees’ salaries in April 2025 by approximately 5% or higher. The CEO mentioned that the goal is to skillfully develop and strengthen the current workforce, enabling them to effectively trade in yen rates without the need for additional hires.

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2024-12-24 14:27