E-Commerce, Technology

Coincheck Takeover Being Considered by Online Japanese Brokerage Monex

Coincheck Takeover Being Considered by Online Japanese Brokerage Monex

In a statement made on Tuesday, online brokerage firm Monex Group Inc, which is based in Japan, has said that it is considering buying the cryptocurrency exchange called Coincheck Inc. Earlier this year, the Tokyo based exchange was at the end of high-scale digital money theft, when close to $530 million were stolen.

No further details were provide in the statement made by Monex, however, earlier on Tuesday a local business newspaper reported on the matter and claimed that the announcement would be made this week and it could be a deal worth several billion yen. Coincheck was contacted for comment on the matter and responded through email, to say that information regarding such an offer had not yet been released.

Monex would be able to gain access to the customer base, as well as the trading platform of Coincheck, if the deal goes through. Japan’s frontier cryptocurrency trading market could witness the addition of yet another mainstream financial services operator, in the case of a takeover. Last year, during the frenzied interest and boom of the cryptocurrency market, Coincheck grew rapidly but has not made any statement of the amount of customers it has.

If calculated by the number of customer accounts, Monex is the third largest online brokerage in Japan and the takeover action the company is being associated with, is not a dissimilar action to its larger competitor called SBI Holdings Inc. A license to operate a currency exchange was acquired by SBI last year, however, it decided to strengthen the security of its exchange and postponed the plans in February, to have the exchange running.

Line Corp, the famous messaging app operator, has been involved in the cryptocurrency scene as well, as it announced in January that it plans on running an exchange as well and said that it had applied for approval. The company provides payment and money transfer services to around 40 million users through its financial arm.

Monex’s market capitalization increased to 114.3 billion yen, as it gained $1.08 billion, due to the company’s 23 percent increase in share price, which is the maximum allowed under the rules of the Tokyo Stock Exchange. However, there was 0.5 decline in the overall Nikkei average.

No details of how the company was affected by the theft in January, which was one of the biggest digital money thefts, were provided by Coincheck. The company used its own funds to pay back investors affected by the hack, a sum of around 46 billion yen.

Comprehensive statistics on cryptocurrencies are not yet available, but Coincheck till March was the fifth largest exchange in Japan, in terms of the volume of Bitcoin being traded and owned a market share of 8.7 percent, according to Jpbitcoin.com. December was the company’s last full month in the market before the hack and was the largest, as more than half of the market was occupied by it.

Of Japan’s 32 exchanges, Coincheck, along with several others, was punished by the country’s financial watchdogs for failing to protect its customers and insufficient anti-money laundering standards.

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