Samuel Bankman-Fried’s FTX contagion spreads to Japan, Kraken announces exit plan
- Samuel Bankman-Fried’s FTX’s bankruptcy had a domino effect on crypto trading platforms, hedge funds and lenders, including Kraken.
- Kraken announced its plan to exit Japan for the second time at the end of January 2023 citing a decline in crypto trade volume.
- Payword Group operates the crypto exchange business of Kraken and the firm announced its plan to reduce its global workforce.
Samuel Bankman-Fried co-founded the now bankrupt FTX exchange that collapsed in November 2022. The contagion has spread to Japan and Kraken has announced its exit from the East Asian island country.
Also read: Japan could lift ban on USDT Tether and USDC circulation, recognising stablecoins as digital money
Samuel Bankman-Fried’s FTX contagion spreads to Asia, Kraken bids adieu to Japan
Samuel Bankman-Fried’s FTX exchange collapsed and is currently going through post-bankruptcy financial engineering. The contagion spread to Asia and leading crypto trade platform Kraken has announced its exit from Japan.
Payword Group operates Kraken’s exchange business and announced its withdrawal from Japan at the end of January 2023. The firm unveiled plans to reduce its global workforce of about 1,100, a reduction of 30%. Payword Group cited the sudden decline in virtual currency trading triggered by the bankruptcy of FTX exchange and that the contagion spread to Japan.
Colin Wu, a Chinese journalist shared details of FTX’s contagion spreading to Japan.
According to nikkei, Kraken announced that it will withdraw from Japan market at the end of January 2023. On December 1, Kraken announced that it would lay off 1,100 people worldwide, accounting for about 30% of its total workforce. https://t.co/H8diSiPmPO
— Wu Blockchain (@WuBlockchain) December 28, 2022
The US-based exchange is the latest player scaling back operations after a difficult year for cryptocurrencies. Per the announcement Kraken will cease operations in the East Asian country by deregistering from the Financial Services Agency on January 31.
The trading platform said that customers should withdraw their fiat and crypto holdings in a timely manner.
The announcement reads:
Current market conditions in Japan in combination with a weak crypto market globally mean the resources needed to further grow our business in Japan aren’t justified at this time. As a result, Kraken will no longer service clients in Japan through Payward Asia.
In 2018, Kraken ceased operations in Japan and cited the rising cost of doing business. The crypto trading platform was relaunched with a Tokyo office in 2020 before leaving the Asian island nation yet again.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
