Fintech firm Money Forward Inc., the operator of one of Japan’s most popular personal budgeting apps, has halted plans to launch a crypto asset exchange, citing a bear market.
As reported by Cointelegraph, Money Forward had set up a dedicated subsidiary for its crypto exchange project in May 2018. The company had planned to launch a crypto media platform in addition to a crypto exchange and a digital assets remittance and settlement system.
The recent announcement disclosed that the firm’s board of directors resolved to cancel the procedure of applying for official registration and to postpone the development of the planned crypto exchange project.
The board’s announcement framed the decision within the context of the company’s first quarter consolidated losses for the fiscal year ending November 2019, stating, “The virtual currency market has cooled rapidly and the downside risk of profitability has been increased by continuing the business.”
The announcement also cited a growing international debate over virtual currency platform hacks and money laundering risks, noting that the costs for ensuring a robust system that protected consumers, while also facilitating convenience for traders, have risen substantially amid an ever-changing business landscape.
However, the board ruled that blockchain research and development will continue, although service provisions for Money Forward’s crypto media platform, Onbit, will end on May 31st.
Earlier this year, Money Forward’s subsidiary attained second-tier membership with the Japan Virtual Currency Exchange Association (JVCEA), a self-regulatory crypto body established in March 2018 to ensure protection standards for investors. The second-tier is for businesses looking to apply for official crypto exchange operating licenses from the country’s Financial Services Agency (FSA)
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