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Early on Thursday bitcoin surged to a record high in terms of its valuation in Japanese yen, outpacing its valuations in other leading fiat currencies such as U.S. dollars, euros, British pounds and Australian dollars. Currency devaluationThis increase in yen valuation can be attributed to the recent depreciation of the Japanese currency against the backdrop of continued money printing by the Bank of Japan (BoJ) and resurging inflation, which have collectively weakened sentiment surrounding the yen. Fiat currencies, including the Japanese yen, lack backing by hard assets and derive their value solely from market perceptions. The current rally of bitcoin is indicative of the prevailing market sentiments, with the yen exhibiting particular vulnerability among major fiat currencies. For instance, early market activity on Thursday witnessed bitcoin, often hailed by proponents as digital gold, hitting a fresh all-time high of 7.9 million yen on Tokyo-based cryptocurrency exchange bitFLYER. In contrast, the cryptocurrency's dollar-denominated price hovered above $52,000, still 32% below its peak of $69,000 in November 2021. This price disparity underscores the strain on the Japanese yen, fueled by the Bank of Japan's persistent liquidity easing measures, rising inflationary pressures and indications of economic fragility.Photo by jun rong loo on UnsplashEntering recessionThis recent surge coincides with reports confirming Japan's descent into an economic recession by the end of the previous year, slipping to fourth place behind Germany in terms of the world’s largest economies. While central banks worldwide, including the Federal Reserve, aggressively raised interest rates in attempts to curb inflation, the Bank of Japan maintained near-zero interest rates and continued printing fiat currency. A recession characterized by inflation without corresponding growth prompts investors to seek refuge in safer havens like gold and digital gold. With that, there could be further opportunities for bitcoin to make further in-roads in Japan. In 2023, Japan's core inflation, excluding volatile food and energy components from the consumer price index (CPI), rose by 3.1%, marking its most significant increase since 1982. Consequently, the yen depreciated to a 33-year low against the dollar, declining by 13% and 7.5% against the dollar previously, with an additional 6.4% decrease this year. Bitcoin's persistent premium in Japanese yen terms suggests that it may continue to maintain higher valuations unless the Bank of Japan accelerates its exit from the ultra-loose monetary policy it has been pursuing. That would make yen holdings relatively more attractive compared to other assets. Although a complete regulatory framework for digital assets in Japan is still lacking, the country has recently moved to make tax rules more crypto-friendly. Bitcoin's elevated valuation against the Japanese yen underscores the challenges facing Japan's fiat currency, driven by monetary policy decisions and economic uncertainties.

Komainu Secures FCA Approval in Boost For Crypto Custody in the UKKomainu, a digital asset storage firm backed by Tokyo-based global financial services group Nomura, has received approval from the UK’s Financial Conduct Authority (FCA) to operate as a crypto custodian wallet provider.Photo by Robert Tudor on UnsplashPaving the way for broader service offeringThe Jersey-headquartered Nomura portfolio company outlined details of its regulatory success in a blog post published on Friday. This regulatory milestone marks a pivotal moment for Komainu’s expansion within the UK market, allowing the firm to amplify its crypto service offering in the UK.The approval paves the way for the firm to offer collateral management services through its platform, Komainu Connect. Sebastian Widmann, Head of Strategy at Komainu, expressed the company’s intention to furnish institutional custody services, a fundamental aspect of the swiftly advancing cryptocurrency market. He also underscored Komainu Connect’s role as a premier collateral management solution within the UK.Komainu’s CEO, Nicolas Bertrand, spoke to the United Kingdom’s pivotal role in the global financial technology sector. He accentuated the UK’s position as a critical hub for fintech, bridging the realms of traditional finance and decentralized finance. The FCA’s endorsement underscores Komainu’s efforts in attempting to deliver secure and compliant cryptocurrency custody services.“This is a key regulatory milestone as the UK remains one of the most important hubs for financial technology and innovation that will spur the convergence of traditional and decentralized finance,” stated Bertrand.This recent approval is not an isolated achievement for Komainu. The firm has been building up recognition for its adherence to regulatory compliance. In August, it secured a full operating license from Dubai’s Virtual Asset Regulatory Authority, reinforcing its dedication to adhering to global regulatory standards.Additionally, being headquartered in Jersey, Komainu falls under the jurisdiction of the Jersey Financial Services Commission, ensuring that the firm also adheres to those local financial regulations.The company previously unveiled an agreement with local authorities, focusing on secure digital asset storage during investigations. This partnership is demonstrative of efforts made by the firm in fostering transparency and security within the cryptocurrency ecosystem, aligning with the broader regulatory objectives of the UK government.Further ambitionsHowever, Komainu’s presence is expected to reach beyond the shores of the UK and Dubai. Coinshares, one of Komainu’s parent companies, recently introduced its hedge fund division, Coinshares Hedge Fund Solutions, signaling its intent to venture into the US market. This strategic maneuver will provide eligible American investors with access to Coinshares’ array of private investment products, further cementing its global presence in the cryptocurrency sector.In June the firm partnered with Seychelles-based global crypto platform OKX. As part of that deal, the digital assets custodian will store and custody digital assets on behalf of OKX's institutional clients.With a positive track record thus far where regulatory compliance is concerned, Komainu is positioning itself for further growth and innovation relative to a fast-developing crypto sector.

Nomura’s Laser Digital Expands Crypto Venture Capital Arm with New PartnerLaser Digital, the cryptocurrency subsidiary of Nomura, one of Japan’s leading financial services companies, is strengthening its venture capital business with the appointment of industry veteran Florent Jouanneau as a new partner.Despite a decline in funding levels across the industry, Laser Digital aims to expand its venture capital arm, according to a report published by The Block on Tuesday.With Jouanneau joining the team, Laser’s venture team now consists of seven members, according to Olivier Dang, the company’s General Partner and Head of Ventures. Laser Digital, launched in the fall of last year, currently employs about 65 people and offers asset management and trading services alongside its venture capital activities.Jouanneau’s previous experience includes positions at White Star Capital, a venture capital firm that invests in Web3 and DeFi startups. He also served as a structured credit and ABS trader at Bank of America, and held sales and trading roles at UBS and BPCE Group’s Natixis.Photo by Markus Winkler on UnsplashCrypto venture business expansionThe decision to expand the venture business comes at a time when VC investments in Web3 are declining. In the first quarter of this year, Web3 venture funding dropped by 80% compared to the same period last year, as reported by data from K33 Research. VC investment in Web3 totaled $2.8 billion in Q1 2023, a significant decrease from $13.5 billion in Q1 2022.Jouanneau acknowledged the market slowdown in 2022 and highlighted the current opportunity for investment. He stated: “We are seeing a lot of valuations being dragged down by effectively the lack of capital to be deployed.” This sentiment aligns with the perspective of many crypto venture capitalists who view the current bear market as a favorable time to invest, given the risk-reward dynamics and the potential for institutional participation.Crypto sector maturationDang expressed optimism about the maturation of the crypto industry, pointing to the increasing interest of traditional financial institutions, including BlackRock, in spot Bitcoin ETFs. Dang believes that as more institutions enter the space, the quality of deal flow and transactions in the venture capital sector will improve.He also emphasized the importance of robust institutional-grade infrastructure to support these institutions, noting that Laser’s association with Nomura has helped instill trust among investors.While Laser’s fund is currently backed exclusively by Nomura, Dang mentioned that they have started raising third-party capital. The fund has invested in early-stage startups focusing on areas such as DeFi, CeFi, Web3 tooling, and infrastructure. Among its portfolio companies are DeFi protocol Infinity Exchange and crypto trading firm CrossX.Dang disclosed that the team aims to make an additional ten investments throughout the rest of this year, prioritizing projects with institutional use cases. However, they remain cautious about ventures primarily focused on gaming and NFTs due to their limited expertise in those areas.As the industry continues to mature and attract institutional interest, it’s clear that Laser is attempting to position itself as a trusted player in the space, leveraging its expertise and partnerships to drive growth and generate value for its investors.