It wasn’t too long before the top and leading Korean crypto trading platform, Kraken, expanded its operations in Japan.
The expansion even required Kraken to avail of a license from and undergo the hectic registration process of the Japan Financial Service Agency (JFSA).
However with all the hassle taken and even after establishing a physical office in Japan, Kraken has decided to end its operations in Japan.
Kraken Announces Its Departure from Japan
Kraken Exchange’s official announcement suggests that it has been permanently shutting down its branch and suspending operations in Japan.
The exchange was rendering crypto trading and exchange services in the jurisdiction of Japan to local crypto investors.
It has been further informed by Kraken that suspension of operations would also require the firm to de-register itself from JFSA. It informed that the de-registration process will be complete by 31st January 2023.
Reasons for Shutting Down
Kraken explained that the exchange has had to relocate investments and prioritize its resources because of which it cannot continue operations in Japan.
Kraken stated that the conditions in Japan are not suitable particularly for Kraken. Resultantly, it has to move on to other areas where conditions best suit Kraken’s objectives, goals, and future endeavors.
The announcement explained that the weak crypto market conditions have worsened business conditions for Kraken in Japan.
Kraken also acknowledged that it lacked the resources in expanding its operations in Japan as the company had wished.
Since June 2022, the Japanese economy has been facing a downtrend. Therefore, the country has been taking several measures to bring the market under control.
The country has resorted to increasing its interest rates as well, causing the country’s investors to pull out of crypto investments.
This is where Kraken comes in, which is finding that the investors in the country are not so excited about the adoption of cryptocurrencies.
What Is Payward?
It may be noted that Kraken had acquired a local Japanese company called Payward Asia. It was through this company, Payward Asia, that Kraken was offering its services to clients in Japan.
Hence, Payward Asia was in fact a company owned and controlled by Kraken as its lawful subsidiary.
Suspension of Kraken’s services in Japan would hence further mean that Payward Asia shall no more available to consumers in Japan.
Notice to Payward’s Clients/Customers
Since Kraken is shutting down in Japan, it is required to settle affairs with Payward’s clients/customers as well as creditors, if any.
In this connection, a customer notice also has been posted and published by Kraken. In the notice, customers have been informed they should immediately withdraw their funds lying with Payward before 31st January 2023.
The notice described that though the withdrawal feature shall be available till 31st Jan yet the deposit feature shall be deactivated on 9th January.
After reading the notice, some of the clients reached out to Kraken and asked for providing a surety of funds return.
The firm ensured its customers that enough funds are available with Payward which can fully fund each and every customer.
Kraken further apprised customers that even after the expiry of the deadline, it will ensure the return of funds in full to customers.
However, the customers have been advised to strictly follow the deadlines so as to avoid any inconvenience.
Crypto Market Conditions’ Worsening
It needs no mentioning that crypto market conditions have weakened a lot since the start of 2022.
Bitcoin was once trading at $69,000 but its value started to deteriorate which caused a value loss of 65% to Bitcoin.
However, the crypto economy decline wasn’t the only ghost that haunted the market throughout the year. It turned out that two of the industry’s reliable sources namely Terra Luna and FTX collapsed with an interval of 6 months.
Present conditions are such that the crypto industry has to start 2023’s progress on the basis of unchanged conditions and circumstances.