Coinbase Global Inc., a US-based cryptocurrency exchange, is scaling back most of its activities in Japan as part of an effort to realign global investment amid a downturn in the digital-asset market.
The change coincides with the company's 20% global employee reduction and the most recent round of layoffs at its San Francisco headquarters. Even as the government relaxes certain crypto regulations, Coinbase is cutting back on its operations in Japan, which has prompted competitor Binance, the largest digital-asset exchange, to apply for a license to re-enter the market.
In an interview on Wednesday, Nana Murugesan, vice president for business development and international, stated:
“We’ve decided to wind down the majority of our operations in Japan, which led to eliminating most of the roles in our Japan entity."
When asked if the Japan operation may be sold, he responded that Coinbase won't comment on any merger and acquisition activities.
A $2 trillion decline in token values from a 2021 peak and a slew of disasters, including most recently the bankruptcy of the FTX exchange, have devastated the digital asset market. This led to several layoffs at cryptocurrency companies.
In order to survive the industry slump, Coinbase is laying off around 950 staff globally, according to Chief Executive Officer Brian Armstrong. He also said that a number of projects with a reduced chance of success will be abandoned.
Previously, Coinbase and Mitsubishi UFJ Financial Group Inc. collaborated on plans to create a cryptocurrency exchange in Japan in 2021. According to Armstrong, the business has prioritized growing its international footprint saying:
“international expansion is really core to our mission of increasing economic freedom in the world."