U.S.-based cryptocurrency exchange Kraken announced on Wednesday that it would stop operating in Japan by the end of the month due to the country’s present market conditions and a weak crypto market globally.
In a blog post published on December 28, Kraken stated that as part of attempts to “prioritize resources” and investment, the company has opted to revoke its registration with the Financial Services Agency by January 31, 2023.
According to the exchange, the resources required to expand their business in Japan at this moment aren’t warranted due to the weak crypto market globally and the current market conditions in Japan. Adding,
“Kraken would no longer provide clients in Japan with services through Payward Asia.”
The exchange that Kraken offers to Japanese users is run by its subsidiary Payward Asia Inc.From 2014 to 2018, the same subsidiary firm operated in Japan before leaving in April 2018 to better concentrate its resources on expansion in other geographic regions.
What Kraken-impacted users need to know
The subsidiary decided to relaunch in October 2020 with a Tokyo headquarters, offering spot trading on five main assets with future expansion plans. With the end of the second round, Kraken has agreed to allow all impacted customers to withdraw their cash from the exchange by January 31 at the latest.
Users can transfer their cryptocurrency assets to an external wallet or convert them to Japanese yen before transferring them to a local bank account. In addition to removing withdrawal restrictions in January, there will be a procedure that users can utilize to get their staked Ether back which will soon be disclosed.
Deposits will be disabled on Jan. 9, though trading functions will remain. In recent months, Kraken seems to have prioritized cost reduction.
In light of challenging market conditions, Kraken said on Nov. 30 that it has made one of its “hardest decisions” to reduce its global staff by about 1,100 workers, or 30% of its personnel.
The exchange claimed that lower trading activity and a decline in new client registrations were factors in Kraken’s decision to reduce costs and that these adjustments were required to sustain the business for the long term.