The crypto industry has taken quite a beating this year and the trend continues as digital currency exchange Kraken announced that it was shutting down its operations in Japan next month.
On Wednesday, Kraken said in a blog post that Payward Asia, its Japanese subsidiary, would stop offering crypto trading services.
It also said that on January 31st, 2023, the entity would also deregister itself from the Financial Services Agency (FSA) in Japan.
This is the second time that Kraken has shuttered its operations in the Japanese market. It had done the same in 2018 when it shut down its operations four years after establishing them in 2014.
In 2020, Kraken registered with the regulator and relaunched its services in the country.
According to the company, it had taken the decision to give priority to investments and resources in areas that suit its strategy and can help it in achieving success in the long term.
When giving reasons for its decision, Kraken talked about a globally weak crypto market as well as the existing market conditions in Japan.
It further said that customers in Japan would have until January 31st to make withdrawals of both their crypto and fiat holdings on the platform.
Kraken said that customers can withdraw their crypto holdings to an external wallet or cash them in the form of Japanese yen that will be transferred to a local bank account.
Japanese users will not be permitted to make any deposits into their account from January 9th onwards, but the platform will still have trading functionality to allow users to convert their existing balance into the asset they prefer.
Kraken is one of the biggest crypto exchanges in the world and its trading volume in a single day is about $408.9 million, as per data from CoinMarketCap.
Like a number of other major players in the crypto industry, Kraken has also been on a cost-cutting spree of late.
The company reduced its workforce by 30% on November 30th, which means 1,100 jobs were wiped out, which it had done to adapt to the market conditions.
This year has seen the crypto market be plagued by different scandals. The trouble had started with the downfall of Terra back in May, which had been valued at $60 billion at one point.
After its collapse, a number of other projects that were exposed to it also fell like dominos, which included hedge fund Three Arrows Capital and crypto lender Celsius Network.
However, the most notable failure to have occurred in the crypto market this year has been the collapse of the FTX crypto exchange.
Its co-founder and former CEO has been released on bail and is now awaiting trial for eight criminal charges, which include fraud and money laundering.
Likewise, there has also been a drop in prices of bitcoin and almost all of the cryptocurrencies in the market, as investor sentiment has taken a hit and rising interest rates have also pressured assets.