Japanese financial conglomerate SBI Holdings Inc has made a strategic investment in Singapore’s first licensed crypto exchange Coinhako.
For this purpose, SBI Holdings has established a joint venture business with Switzerland-based Sygnum Bank as the company aims to expand the crypto business into a core pillar of profitability.
“The fund leverages the in-depth expertise of both the Group and the Sygnum Banking Group, which are pioneers in the field of digital assets, to complement digital assets, financial services and fintech, as well as the networks of both companies across Asia and Europe. And in Europe, we plan to make venture investments focused primarily on financial market infrastructure and enterprise solutions related to DLT,” the two companies said in a statement.
Japan’s biggest online brokerage has been providing its global clients with cryptocurrency trading services since 2018.
Aiming to expand its cryptocurrency portfolio, the Japanese conglomerate bought local exchange Tao Tao. Also in 2020, SBI’s UK arm had fully acquired cryptocurrency market maker and liquidity provider, B2C2, which was the latest example of how mainstream giants and crypto startups are tying up.
Moreover, other subsidiaries at SBI groups are active in other blockchain projects. Apart from its Japanese security token offering (STO), for example, SBI additionally invested in San Francisco-based STO startup, Securitize, and enterprise blockchain firm, R3. Also, SBI maintains investments in Ripple and the MoneyTap blockchain payments app.
The first local non-bank crypto exchange MAS approval
Coinhako is one of the oldest crypto exchanges in Asia, and its operations are heavily focused on Singapore, Malaysia, Indonesia, and Vietnam. It supports more than 25 cryptocurrencies and up to 100 fiat-crypto pairings. The exchange allows users to make multiple transactions – ranging from FX exchanges, crypto to crypto exchanges, and moving tokens across different platforms.
Coinhako operates under an in-principal approval from the Monetary Authority of Singapore for a digital payment token (DPT) service license. Actually, it was the first local native cryptocurrency exchange to secure the much-coveted license.
Launched in 2014, the Coinhako claims to have over 300,000 registered users in the city-state and an average of 150,000 monthly active users. However, security has been an issue for this Asian crypto exchange in particular. In 2020, Coinhako abruptly frozen all clients’ withdrawals due to a cyberattack.
The Monetary Authority of Singapore (MAS) has updated its regulatory framework for crypto-related activities, including digital payments. The country’s Payment Services Act (PSA) covers all crypto businesses and exchanges based in Singapore, bringing Coinhako and its peers under anti-money laundering and counterterrorist-financing rules.
