Japan's leading e-commerce and internet services company Rakuten Inc. has announced the decision to acquire a 100% stake in a local cryptocurrency exchange 'Everybody’s Bitcoin' through its subsidiary, Rakuten Card Co. The acquisition appears to be costing the company $2.4 million, when it goes through on October 1.
Started in March 2017, Everybody’s Bitcoin is one of the unlicensed cryptocurrency exchanges in Japan that came under the scrutiny from Japan's Financial Services Agency (FSA) after the Coincheck’s $530 million hack in January, as the regulatory body sought business and security improvements.
In April 2018, the exchange received a business improvement order from the Kanto Local Finance Bureau (KLFB) regarding the establishment of management control systems, an action plan to control money laundering and funding of terrorism, and action on book management systems, user protection measures, system risk control, and the management of outsourcing of business operations.
Everybody’s Bitcoin aims to register officially as a cryptocurrency exchange, and in order to further promote its cryptocurrency business, it decided to expand the business under the Rakuten Group to maximize synergies. Rakuten Group said it decided to acquire Everybody’s Bitcoin shares so that it can realize the early registration as a cryptocurrency exchange and develop cryptocurrency services to customers by combining the know-how of both the companies.
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The Rakuten Group established Rakuten Blockchain Lab, a dedicated research and development organization in Belfast, the UK in 2016, and has been researching blockchain technology over the years. It said:
"We expect that the role of cryptocurrency-based payments in e-commerce, offline retail and in P2P payments will grow in the future. In order to provide cryptocurrency payment methods smoothly, we believe it is necessary for us to provide a cryptocurrency exchange function, and have been considering entry into the cryptocurrency exchange industry as the Rakuten Group."
Last week, Japan’s financial services giant SBI Holdings also made the second round of investment in troubled cryptocurrency exchange LastRoots, which had also received a business improvement order, to help them become a registered trading platform. In a similar move earlier this year, Japanese online brokerage firm Monex also acquired hacked virtual currency exchange Coincheck.