Global cryptocurrency exchange Kraken has decided to pull its operations in Japan for the second time, citing a strain on its resources amid a âweak crypto market.â
In a Dec. 28 blog post, Kraken said it has decided to cease its operations in Japan and deregister from the Financial Services Agency by Jan. 31, 2023, which it said was part of efforts to âprioritize resourcesâ and investments, stating:
âCurrent market conditions in Japan in combination with a weak crypto market globally mean the resources needed to further grow our business in Japan arenât justified at this time.â
âAs a result, Kraken will no longer service clients in Japan through Payward Asia,â it added.
Krakenâs Japanese-facing exchange is operated by its subsidiary Payward Asia Inc.
The same subsidiary company operated in Japan from 2014 to 2018, before pulling out in Apr. 2018 so that it could better focus its resources on growth in âother geographical areas.â
In Oct. 2020, the subsidiary decided to relaunch with a headquarters in Tokyo, offering spot trading on five major assets with plans to expand. The second iteration has now come to an end, with Kraken committing to allowing all affected clients to withdraw their funds from the exchange by Jan. 31, 2023, at the latest.
Users can withdraw crypto holdings to an external wallet, or convert the portfolio to Japanese Yen and then transfer it to a domestic bank account. Withdrawal limits will be removed in January and there will also be a process to allow users to retrieve their staked Ether (ETH) which will be shared shortly.
Deposits will be disabled on Jan. 9, though trading functions will remain.
There has never been a dull moment in crypto, and this year was no different.
— Kraken Exchange (@krakenfx) December 27, 2022
Kraken appears to have been focusing on cutting costs in recent months.
On Nov. 30, Kraken announced it had made one of its âhardest decisionsâ to cut its global workforce by approximately 1,100 people, equivalent to 30% of its headcount amid difficult market conditions.
Related: Kraken cuts workforce by 30% in an effort to survive crypto winter
The exchange said lower trading volumes and fewer client sign-ups contributed to Krakenâs decision to cut down on expenses and that the changes were necessary âto sustain the business for the long-term.â
In the Japanese language version of the most recent announcement, Kraken added that its exit from the Japanese market will not have a material impact on Krakenâs overall business.