(JapanTimes)– Online brokerage Monex Group Inc. announced Friday that it would acquire Coincheck Inc.— the troubled cryptocurrency exchange that was hit earlier this year by a massive cybertheft — in a bid to enter the growing virtual currency industry.
Tokyo-based Monex, the third-largest online brokerage in the nation, said it will purchase 100 percent of Coincheck’s shares for ¥3.6 billion ($33.6 million) this month and make the startup its wholly owned subsidiary.
Coincheck’s growth and existing 1.7 million-user base are sure to help Monex ease into the cryptocurrency business. But the online brokerage will also be inheriting risks, including a damaged brand and lawsuits filed by investors affected by the NEM coin theft.
“Coincheck is a pioneer of the crypto-exchange business, not only in Japan but in the world. … It has a global brand value, user base, technologies,” said Monex Group CEO Oki Matsumoto at a news conference in Tokyo. “It’s possible to manage risks but it’s no easy job” for Monex to create a user base and brand like Coincheck’s by itself.
Matsumoto said the new Coincheck aims to gain government approval as a registered cryptocurrency exchange in two months.
Under the revised law that took effect last year, cryptocurrency exchanges are required to register with the government after a screening process, but the financial watchdog has yet to give the firm the green light.
Matsumoto also said Monex aims to take Coincheck public in the future.
Coincheck’s board will be completely reshuffled through the acquisition, with Toshihiko Katsuya — a senior executive at Monex in charge of the firm’s cryptocurrency business — taking over in the post of president from Koichiro Wada, the current chief and founder of Coincheck. Wada will become an executive officer under the new management.
In light of the Coincheck hack in January, which caused losses valued at ¥58 billion ($532 million) at the time, the Financial Services Agency issued a business improvement order and urged the company last month to drastically review its management team.
The heist has marred the image of cryptocurrencies whose values had surged in the past year, most notably bitcoin.