Recent news articles state that due to the turbulent market conditions in Japan, Coinbase Global Inc has decided to stop its activities there. The most prominent crypto currency exchange in the United States also said it will carry out a "comprehensive evaluation of our operations in [Japan]."
Coinbase, which has stated (1) that it will attempt to make the changeover in Japan run as smoothly as possible, also commented:
"We want to reassure you that we have separated our clients' Japanese yen & crypto assets in custody in conformity with the legislation. Additionally, we are dedicated to ensuring that our customers may withdraw their funds at their earliest convenience."
Customers of Coinbase Japan have until February 16th to withdraw any fiat currency or crypto currency assets they may have before the exchange resumes operations.
According to the most prominent crypto currency exchange, clients can withdraw their crypto currency holdings to several different possibilities. Other Digital Securities Providers, Coinbase Wallet, or the customer's pick of any other self-hosted wallet are some of the alternatives that are available to them. In addition, customers can sell their portfolios and transfer the resultant fiat value to a bank account in their home country.
Coinbase also warned that it would convert any crypto currencies left over to yen on or following February 17th. In addition, the exchange can deposit any unspent monies into a guarantee account held by the Legal Affairs Bureau for the next month.
The Precarious State of the Crypto Market Is Driven Home by Coinbase's Plan to Withdraw from the Japanese Market
Following a decision taken by another US-based crypto currency exchange, Kraken, to suspend its operations in Japan, Coinbase has chosen to do the same. Kraken announced a little less than a month ago that, as part of its efforts to reduce costs, it will end its operations in Japan by the beginning of January.
The corporation in San Francisco gave the excuse of a lackluster state of the global crypto currency market when they made the news. The fact that Coinbase has stopped doing business in Japan owing to a decline in the value of digital assets is another evidence that the sector is now in a precarious situation.
Coinbase Reducing its Expenses
Coinbase's expansion into Japan follows closely on the heels of the company's decision to reduce its overall staff by 20% to conserve cash.
The chief executive officer of Coinbase, Brian Armstrong, explained the significant employee reduction the previous week. In his judgment, the exchange needed measures to increase its chances of surviving a "stress test scenario" prompted by FTX.
Armstrong implied that the worst was yet to come when he referred to the failure of FTX and the consequent crypto market crunch as a "black eye for the industry."
The majority of the difficulties that plagued the crypto currency market over most of the previous year have also carried over into the new year. These factors include a shrinking desire among investors for digital assets, rising interest rates, and concerns about a full-blown global economic slump.
Several investors have already removed their money from risky investments like crypto currency and tech stocks. This pattern has led to the widespread selling of the assets in question, which has unwittingly driven down their prices.