Tokyo-based BitFlyer took this strategic step by purchasing all shares of FTX Japan. This move is considered part of BitFlyer’s goals to strengthen its presence in Japan and expand its cryptocurrency custody services.

BitFlyer acquired 100% shares of FTX Japan, taking this unit under full control. Although financial details about the acquisition were not disclosed, it is stated that this step of BitFlyer aims to increase its influence in the cryptocurrency market in Japan.

The acquisition was made after FTX Japan entered Chapter 11 bankruptcy protection in November 2022. FTX Japan ended its exchange operations after filing for bankruptcy, but continued to manage client assets.

After BitFlyer acquires FTX Japan, it will rebrand the unit as “Custody New Company” by August 26. This new entity will focus on expanding BitFlyer’s cryptocurrency custody business using its existing operational resources and wallet technology.

Additionally, once the regulatory and tax rules in Japan are finalized, it is planned to explore services related to physical crypto exchange-traded funds. According to BitFlyer’s statement, this new structuring aims for the company to have a broader impact on the cryptocurrency ecosystem in Japan.

FTX came to the fore with a major cryptocurrency scandal in late 2022. Accusations of embezzlement and abuse emerged related to the company’s owners and affiliated hedge fund Alameda Research. These events led FTX to file for bankruptcy and cease exchange operations in Japan.

This collapse, which had a huge shock effect on the cryptocurrency market, attracted the attention of regulators and investors. FTX Japan continued to manage client assets during the bankruptcy process, but it led to a loss of confidence in the cryptocurrency market.

BitFlyer’s acquisition of FTX Japan could lead to significant changes in the cryptocurrency market in Japan. The acquisition highlights the need to strengthen cryptocurrency regulations in Japan and improve the legal framework in the industry.

BitFlyer’s plans to rebrand FTX Japan as “Custody New Company” and expand its crypto custody services through this new structure could create new opportunities for cryptocurrency investors in Japan.

These developments will consolidate BitFlyer’s leadership in Japan and increase competition in the industry. Additionally, BitFlyer’s new restructuring can increase the dynamism in the industry by contributing to the development of the cryptocurrency ecosystem in Japan. The growth of the cryptocurrency market and the strengthening of the regulatory framework may increase BitFlyer’s competitiveness in the global market and have an impact on other players in the industry.

BitFlyer’s strategic moves can shape the dynamics and market structure in the cryptocurrency industry. In this context, the rebranding of FTX Japan and the expansion of crypto custody services could create new opportunities for cryptocurrency investors in Japan and strengthen BitFlyer’s role in the industry.