Binance, the popular cryptocurrency exchange, is making a comeback in the Japanese market after a five-year absence.
The company is in the process of establishing a new subsidiary in Japan, which will operate under full regulation. This move comes after Binance acquired Sakura Exchange Bitcoin (SEBC), a regulated cryptocurrency exchange, in November 2022.
As part of the acquisition deal, SEBC will cease its current services by May 31 and rebrand as Binance Japan in the following weeks. Users of Binance’s global platform in Japan will need to register with the new subsidiary. The migration process is set to begin on August 1, 2023, and will include a new identity verification process to comply with local requirements.
Binance has previously stated that any remaining funds on the SEBC exchange will be automatically converted to Japanese yen and transferred to users’ bank accounts starting in June.
The exchange has been pursuing a strategy of expanding its global reach by acquiring locally-regulated entities in order to navigate the evolving regulatory landscape. This approach has been evident in its moves in Singapore in 2021, Malaysia in 2022, and most recently, Thailand. In Japan, Binance ceased operations in 2018 after failing to obtain an independent license from local regulators.
Binance has clarified that it will not offer derivative services in Japan, and its global version will not accept new derivative accounts from users in the country. Furthermore, Japanese residents using the global platform will no longer be able to open new options positions or increase existing ones after June 9. Pending orders will be canceled, and existing positions must be closed by June 23. Binance Leveraged Tokens will also be unavailable for trade or subscription.
The company has expressed its intention to work closely with regulators and comply with regulations in order to potentially offer derivatives services in the future. Japan was one of the first countries to introduce crypto regulations, and its laws, such as the requirement for exchanges to separate client funds from other assets, have played a role in facilitating the recovery of funds in cases like FTX Japan, a subsidiary of the now-bankrupt crypto exchange FTX, earlier this year.
