Japan’s Financial Services Agency is seeking feedback on new regulations that would allow foreign stablecoins to be listed on the country’s exchanges. The regulation would allow distributors to handle payments-focused stablecoins.

Cryptocurrency investment firm Midas Investments, which focused on decentralized finance (DeFi) yields, is shutting down following significant losses experienced in 2022.

Cryptocurrency exchange Kraken has decided to pull its operations in Japan for the second time, citing a strain on its resources during a “weak crypto market.” In a blog post, the firm detailed it will deregister from the Financial Services Agency by January 31, 2023.

Top stories in the Crypto Roundup today:

• Japan Considers Allowing Exchanges to List Foreign Stablecoins
• Midas Investments Shuts Down DeFi Platform Following Losses
• Kraken Exits Japan Over ‘Weak Crypto Market’
• Digital Asset AUM & Product Volumes Experience Significant Decline in 2022

Japan Considers Allowing Exchanges to List Foreign Stablecoins

Japan’s Financial Services Agency is seeking feedback on new regulations that would allow foreign stablecoins to be listed on the country’s exchanges. The regulation would allow distributors to handle payments-focused stablecoins.

The regulations reportedly stand to reverse a ban on the distribution of foreign stablecoins locally, as local exchange currently do not list stablecoins like USDC and USDT, which are issued by foreign entities.

Japan’s parliament passed a set of rules specific to stablecoins and focused on investor protection after the collapse of the Terra ecosystem. The new rules would be applied in conjunction with the Payment Securities Act.

The framework is open for public comment until January 31, and will come into force later in 2023.

Midas Investments Shuts Down DeFi Platform Following Losses

Cryptocurrency investment firm Midas Investments, which focused on decentralized finance (DeFi) yields, is shutting down following significant losses experienced in 2022.

In a blog post, its CEO and founder Iakov Levin wrote that this past spring the company’s DeFi portfolio lost $50 million, or 20% of its $250 million in assets under management, and that after the collapse of Celsius and FTX, it experienced a 60% drawdown on its assets under management. Levin wrote:

“Based on this situation and current CeFi market conditions, we have reached the difficult decision to close the platform.”

Midas Investments will be shifting its focus to a new project centered around Centralized Decentralized Finance (CeDeFi), according to Levin. In preparation for this transition, the company has disabled deposits, swaps, and withdrawals.

As part of the necessary adjustments, Midas plans to deduct 55% from user balances held in Bitcoin, Ether, and stablecoins, and will compensate affected users with MIDAS tokens that can be exchanged for tokens in the new CeDeFi project.

Kraken Exits Japan Over ‘Weak Crypto Market’

Cryptocurrency exchange Kraken has decided to pull its operations in Japan for the second time, citing a strain on its resources during a “weak crypto market.” In a blog post, the firm detailed it will deregister from the Financial Services Agency by January 31, 2023.

The moves comes as part of its efforts to “prioritize resources” and investments. The blog post reads:

“Current market conditions in Japan in combination with a weak crypto market globally mean the resources needed to further grow our business in Japan aren’t justified at this time.”

It adds Kraken will “no longer service clients in Japan through Payward Asia,” which is Kraken’s subsidiary that operates in Japan. The company also pulled out from the country in April 2018 after operating there for four years to focus its resources on growth in other geographical areas.

Users can withdraw their cryptocurrency holdings to an external wallets or convert their portfolio into Japanese yen before moving the funds to a domestic bank account. Withdrawals limits will be removed in January, and there will be a process for users to retrieve their staked Ether.

Digital Asset AUM & Product Volumes Experience Significant Decline in 2022

In 2022, digital asset investment products’ assets under management (AUM) and average daily volumes saw a significant decrease due to various macroeconomic challenges and major events that impacted the entire industry.

Average daily volumes have dropped by 74.1% to $203 million in 2022, compared to $781 million in 2021. Average monthly AUM also experienced a similar decrease of 39.5% to $31.9 billion, compared to $52.8 billion in 2021.

Read more in CryptoCompare’s latest Digital Asset Management Review report.

State of the Crypto by Top Tier Exchange Volume

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