Japan crypto exchange bitFlyer weighs acquisition to boost firm

[SINGAPORE] Japan's largest Bitcoin exchange, bitFlyer Inc, is considering acquiring a small domestic or foreign rival to scale up its business, said its chief executive officer Yuzo Kano.

"We are thinking of acquiring a small exchange because we are not super big," the 45-year-old executive said in an interview on the sidelines of the Bloomberg New Economy Forum in Singapore on Thursday (Nov 18), declining to name any potential targets. "It could be in Japan or in a different country."

Kano - who co-founded bitFlyer in 2014 - is targeting a 10 per cent share of the cryptocurrency market in the US, but is aware that it may be "really difficult" given Coinbase Global Inc's dominance there.

"BitFlyer is very well known in Japan, but nobody knows it in Europe or the US," the former Goldman Sachs Group derivatives trader said in a separate interview with Bloomberg TV. The exchange currently has 3 million users and US$8 billion worth of assets, Kano said.

The Tokyo-based firm is seeking to more than double its target for the proportion of revenue it makes overseas, president Kuniyoshi Hayashi said in an interview in May.

bitFlyer's sales overall rose 41 last year to 7.6 billion yen (S$90.4 million), according to its website, and its main non-Japanese institutional clients have so far been family offices and hedge funds.

BitFlyer recently applied for a licence in Singapore to access clients in the city-state, including hedge funds, he said. It is also planning to enter the non-fungible token market to tap the boom. "Japan has a huge advantage," he said. "It has a lot of intellectual property on anime characters like Pokemon and Hello Kitty."

BLOOMBERG