Crypto exchange Coinbase to shut down most operations in Japan

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U.S.-based cryptocurrency exchange Coinbase Global Inc. is shutting down most of its operations in Japan as part of a move to adjust international investments amid a collapsing digital asset industry.

The change comes as the company cuts 20% of its workforce globally, the latest layoffs at the San Francisco-based company. Coinbase is scaling back operations in Japan even as the country eases some crypto rules, prompting rival Binance, the largest digital asset exchange, to seek a license to return to the country.

We have decided to end the majority of our operations in Japan, which has resulted in the elimination of most roles in our Japanese entity,” said Nana Murugesan, vice president of business and international development, in an interview on Wednesday. . He said Coinbase would not comment on potential merger and acquisition activity when asked if the Japanese unit could be sold.

The digital asset industry has been hammered by a $2 trillion rout in token prices from a 2021 peak and a series of blowouts, most recently the bankruptcy of exchange FTX. This sparked a series of layoffs at crypto companies.

Coinbase is laying off about 950 employees globally, a step chief executive Brian Armstrong said is necessary to ride out the industry downturn. He added that several projects with a low probability of success will be stopped.

Murugesan did not specify how many Japanese employees are affected and said a small number remain to ensure the safety and security of customer assets.

He added that Coinbase is in a transition period until discussions with the Japan Financial Services Agency are finalized. Japan’s chief executive Nao Kitazawa is involved in those talks and his next steps will be finalized afterward, Murugesan said.

Coinbase previously partnered with Mitsubishi UFJ Financial Group Inc. to launch a crypto exchange in Japan in 2021. The company has long been focused on increasing its overseas presence, with Armstrong saying international expansion is truly at the heart of our mission to increase economic freedom around the world. .”

Barriers to expansion

Coinbase has encountered obstacles in its quest for global growth. A potential deal to acquire Brazilian crypto brokerage 2TM Participacoes SA fell apart last year. Coinbase also halted a crypto buying service in India after coming under pressure from the company’s central bank.

Murugesan said Coinbase remains committed to global expansion and described developments in Japan as an example of right sizing. “The company is prepared to make tough decisions to ensure our investments are aligned with local market opportunities,” he said.

Earlier, a spokesperson for the Japanese unit said no decision had been made at this time beyond downsizing “while adding that we are carefully evaluating all options”.

In June, Coinbase announced that it would be laying off 18% of its workforce, the equivalent of around 1,200 employees. He eliminated 60 other positions in November.

This story was published from a news feed with no text edits.

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