Japan’s SBI Group launches world’s first bank-backed crypto exchange
Japan’s Strategic Business Innovator Group, the provider of financial services to new and emerging industries, went live on Monday with own cryptocurrency exchange – the world’s first such exchange to backed by a major banking institution.
Following several weeks of delay due to cyber-security concerns, the VCTRADE platform is now open to users who pre-registered to use the trading venue in October and will be available to a wider public in the coming months, the company said in a statement on Monday.
VCTRADE, is ran by SBI Virtual Currencies – a wholly-owned subsidiary of SBI Holdings formed in October 2016 – and will focus on the trading of XRP, the Ripple token, as its base currency. The exchange will add bitcoin and bitcoin cash at a later date, as yet unspecified.
SBI Virtual Currencies completed its registration with Japan’s financial regulator, the Financial Services Agency, in September last year and was the first cryptocurrency exchange to be wholly owned by a major financial services institution.
Security concerns addressed
Launch was delayed, however, over cyber-security concerns following the major hacking incident on the CoinCheck exchange in January when nearly $500m in digital currencies was stolen from a hot wallet.
In order to ensure a secure platform, therefore, SBI Virtual Currencies has partnered with SECOM Trust Systems on wallet management.
VCTRADE has said it will offer the narrowest trading spread levels of any of its rival platforms, and will provide the world’s highest level of low-latency trading – meaning speedy transaction completions. It will provide this by adopting Nasdaq’s “matching system” for its transactions.
In using XRP as its base currency, SBI Holdings chief executive Yoshitaka Kitao stated: “XRP has a very clear use case: it is faster, cheaper and more scalable than any other digital asset. I strongly believe it will become the global standard in digital currencies.”
To begin with, the service will be limited to the to the 20,000, or so, users who registered in October. SBI Virtual Currencies said the general application for opening accounts will begin next month.
Trading hours will be between 7am and 6am the next day. There will be no transaction fees, but a transfer fee will charged on withdrawals and the settlement currency will be Japanese yen.