Bitcoin and other forms of crypto may be falling in price, but people are still taking their earnings and investing in cryptocurrency projects. The most recent one comes by way of Madison Holdings Group, a Hong Kong stock exchange-listed wine company. The venture has just purchased shares in BitOcean, a Japan-based cryptocurrency exchange.
BitOcean is one of Japan’s 16 fully licensed crypto trading platforms, having recently garnered full approval from Japan’s Financial Services Agency (FSA). Madison Lab – a subsidiary company of Madison Holdings – has acquired roughly 67 percent of BitOcean, spending about $30 million in the process.
Crypto Investments Remain as Popular as Ever
Madison’s chairman Raymond Ting Pang-wan explains that the maneuver was all part of the company’s attempts to diversify itself and build its investment portfolio:
“Our wine business is stable and profitable, but then it is small. It is hard to make wine trading into a very big business. That’s why we have to diversify into financial technology and the cryptocurrency business – to achieve a better return for our shareholders.”
Despite being home to two of the world’s largest cryptocurrency thefts – Mt. Gox and Coincheck – Japan is, and remains a powerful cryptocurrency hub. The country’s FSA pledged to become more involved in crypto-based operations following the Coincheck debacle in January 2018, an event that saw more than $500 million in cryptocurrency funds disappear overnight.
The FSA began issuing warnings to several cryptocurrency exchanges, claiming that they would now have to undergo a registration process to continue their operations and that they would be required to improve their safety protocols or face being shut down.
This regulatory framework and Japan’s ongoing pro-crypto attitude is why, according to Pang-wan, now was the best time to obtain a stake in the crypto arena:
“Japan represents about 20 percent of bitcoin trading worldwide. Japan and the United States are the only two markets that have a licensing system for such trading platforms. We wanted to invest in a platform that was under proper regulation.”
Crypto Investments Everywhere
In a related story, HDR Global Trading – which owns the BitMEX Exchange in Hong Kong – is now looking into purchasing a 51 percent stake in Madison Labs. The deal has not taken part at press time, though it’s estimated the purchase will cost roughly $17 million.
Unlike Japan and the U.S., Hong Kong has yet to enforce an official licensing structure for cryptocurrency-related businesses, though it’s now working on a temporary system that would slowly begin to introduce regulatory tactics.
Will a deal like this cause competing companies to invest in crypto? Post your comments below.
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