Size Matters: Japan Becomes Largest Bitcoin Exchange Market, Beats China and US
The size of the Japanese Bitcoin exchange market surpassed that of China and the US, overtaking two major markets to become the largest Bitcoin exchange market in the world.
The size of the Japanese Bitcoin exchange market surpassed that of China and the US, overtaking two major markets to become the largest Bitcoin exchange market in the world with a $135 mln daily trading volume and over 50 percent market share.
A whole variety of factors have contributed to such an exceptional growth. However, after careful consideration of major events that have occurred in 2016, the decline of the Chinese market and introduction of sound, practical regulations from the Japanese government might have had the strongest impact on the growth of the Japanese Bitcoin industry.
The Japanese economic miracle 2.0
Over the past few months, Cointelegraph provided extensive coverage on the development of the Japanese Bitcoin market. In May of last year, the Japan Times reported that the cabinet in Japan approved a set of bills that granted Bitcoin and other virtual currencies legitimacy as money.
At the time, virtual currency specialist and Attorney at Law So Saito told Cointelegraph:
"I think that the new law will advance an acceptance of Bitcoin and other VC. Some of the major financial institutions, investors, and advertising agencies have hesitated to be relevant with Bitcoin. The reasons are that Bitcoin is not regulated, the nature of it has been uncertain and some still have a bad impression of Bitcoin."
Since then, the merchant adoption of Japan grew exponentially and leading Japanese Bitcoin exchanges such as bitFlyer secured a $27 mln Series C funding round led by SBI Investment, an investment arm of the multi-billion dollar group SBI Group.
In an interview, bitFlyer CEO Yuzo Kano stated that investors including SBI Group thought highly of the exchange’s increasing trading volumes, the potential of the Japanese Bitcoin market and the company’s strategy in actively looking into the development of Blockchain technology to target the Japanese fintech industry.
Months after the Series C funding round, bitFlyer secured yet another $1.75 mln investment from Mizuho Financial Group, Sumitomo Mitsui Financial Group, Mitsubishi UFJ Financial Group and Dai-ichi Life Insurance, to expand the exchange’s operations into the remittance market.
BitFlyer raised over $30 mln in total investment which provided the company with a level of financial stability and flexibility to focus on product development and expanding its user base. However, the real merit of these multi-million investments is the partnership between bitFlyer and industry-leading companies in Japan, that is supporting the exchange with a clear vision and regulatory strategy.
As a result, bitFlyer overtook Chinese and American Bitcoin exchanges, becoming the global Bitcoin powerhouse. Currently, bitFlyer controls over 60 percent of the Japanese Bitcoin exchange market and processes nearly $80 mln in trades on a daily basis.