Coinbase to close operations in Japan as part of cost-cutting drive

  • Cryptocurrency News
Coinbase to close operations in Japan as part of cost-cutting drive
Credit: © Reuters.

By Geoffrey Smith -- Coinbase (NASDAQ: COIN ) is admitting defeat in Japan.

The digital currency exchange company said on Wednesday it's pulling out of Japan, the latest stage of a deep retrenchment following the collapse of crypto values last year. 

The company, which announced plans to cut another 20% of its staff earlier this month, said it will conduct a "complete review of our business in the country."

In announcing the job cuts last week, chief executive Brian Armstrong had said that the company will be shutting down several projects where it sees "a lower probability of success."

Crypto adoption in Japan has been sluggish, relative to the size of its overall economy, not least due to early action by financial regulators to limit what exchanges can do. Coinbase rival Kraken had said at the end of December that it too will cease operations in the country this month.  

Customers will have until February 16 to withdraw their holdings of both crypto and fiat currencies from the exchange. Any holdings that remain with it after that date will be converted into Japanese yen and the money will be sent to a Guaranty Account at the Legal Affairs Bureau, in line with local law. 

The news comes as Bitcoin and other digital currencies stage something of a mini-revival, amid tentative hopes that the worst is over. Recent signs that the Federal Reserve is slowing the pace of its interest rate hikes and hopes that it may yet reverse course this year have supported cryptocurrencies along with other risk assets. Coinbase stock rose over 8% on Tuesday as Bitcoin rose to top $22,000 for the first time in two months.

However, huge uncertainties still hang over the industry, notably in the shape of the Securities and Exchanges Commission's charges against Gemini and Genesis, and in the Department of Justice's ongoing investigation into the world's largest crypto exchange, Binance.


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