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Monex Group, a well-known securities broker in Japan’s financial services sector, is delving further into the digital currency space through the acquisition of a majority stake in 3iQ Digital Holdings, a Canadian crypto asset management company. Whilst the acquisition was announced via a joint press release on Thursday, the specific details of the deal were not disclosed.Photo by sebastiaan stam on UnsplashAchieving growth through cryptoYuko Seimei, the CEO of Monex Group, emphasized the long-term strategy of strengthening their asset management business. By incorporating 3iQ into their portfolio, the aim is to achieve substantial growth by catering to the evolving crypto asset management needs of institutional investors and crypto exchanges globally. Monex Group is already a key player in the Japanese crypto landscape, owning the Coincheck exchange. Coincheck is one of the largest cryptocurrency exchanges in Japan. It has regained market dominance after a cyber attack resulting in the theft of $534 million in digital assets in 2018. Monex collaborated with Japanese telecommunications firm NTT DOCOMO in October, forming Monex Securities as a holding company containing Coincheck, while selling NTT DOCOMO a 49% stake. ETF focusThe acquisition of 3iQ marks Monex’s strategic move to extend its exposure to the North American crypto industry. This adds to the conglomerate’s existing presence in the United States through the ownership and operation of TradeStation, an American brokerage firm. 3iQ, operating under a Canadian license, has come to prominence in the crypto-sphere for launching two exchange-traded funds (ETFs) in Canada. Notably, it introduced Bitcoin and Ethereum ETFs on the Toronto Stock Exchange, showcasing innovation in a region where regulatory approval is awaited by U.S.-based companies. Spot bitcoin ETFs have been hotly tipped to offer the next form of crypto adoption, potentially facilitating the in-flow of massive amounts of money currently within the domain of traditional finance. While the focus has been largely on the United States in that regard, other centers such as Hong Kong are similarly gearing up towards offering spot ETF crypto products to both institutions and retail investors. Amid that background, this acquisition by Monex didn’t go unnoticed by ETF sector professionals. Bloomberg Intelligence ETF Research Analyst James Seyffart took to social media platform X on Thursday to draw attention to the deal. Frederick Pye, the Chairman and CEO of 3iQ, expressed enthusiasm about joining forces with Monex Group. With Monex already owning Coincheck, a crypto exchange powerhouse in Japan, Pye highlighted the potential synergy. The collaboration is seen as an opportunity to enhance Coincheck’s offerings, particularly for institutional investors. Pye characterized the partnership as a groundbreaking collaboration that promises to reshape the crypto industry. Monex’s acquisition of 3iQ is aligned with its broader vision of being a key player in the global crypto asset management landscape. The move not only expands their reach into North America but also positions them to capitalize on the growing demands of institutional investors in the evolving digital currency market.

Japanese Crypto Firm Pafin to Introduce DeFi Asset Management PlatformA Japanese company specializing in cryptocurrency services is preparing to launch a DeFi asset management platform.Photo by Shubham Dhage on UnsplashDeFi asset managementPafin, the company behind Cryptact, a service that automates cryptocurrency profit and loss (P&L) calculations, is set to introduce Defitact on June 5. Defitact is a platform designed to consolidate transactions involving decentralized finance (DeFi) assets and NFTs, complemented by illustrative charts. Pafin claims that it is the first provider of crypto P&L calculations to offer blockchain asset management in the Japanese language.The company envisions a broad array of services through Cryptact, from asset management to P&L calculations, to support all Web3 activities in today’s digital landscape.Beta test for subscribersStarting from May 29, Pafin will roll out a beta test for Defitact, exclusive to Cryptact newsletter subscribers. Subscribers will be able to access the service by entering their wallet addresses in the URL provided with the newsletter, which will be sent on the beta test launch date. The newsletter will be sent to those who sign up by May 28, and registration for a Cryptact account is free.This service emerges amidst the growing prominence of Web3, with DeFi — a financial service leveraging blockchain technology — standing out as one of its most rapidly evolving sectors. As of the close of 2021, the DeFi market had a near $100 billion valuation, according to a report by the Japan Research Institute.The nature of DeFi, lacking a centralized administrator, places the onus of crypto wallet management on individuals. The Defitact service seeks to resolve the inconvenience of monitoring and managing real-time transactions on DeFi platforms, typically operating outside crypto exchanges.Available in Japanese and EnglishAs a free, bilingual (Japanese and English) service, Defitact provides a transaction history and displays crypto market capitalization in three fiat currencies: the Japanese yen, the US dollar, and the euro.Pafin’s future plans include integrating Defitact with Cryptact, adding an NFT management service, and enabling the aggregation of multiple wallets for efficient digital asset portfolio management.

Hitachi collaborates with Concordium on biometric crypto walletJapan’s Hitachi Solutions, a subsidiary company of the Hitachi multinational conglomerate, has joined forces with the Concordium Foundation, unveiling a collaboration that centers on a state-of-the-art biometric crypto wallet.Photo by Nuno Antunes on UnsplashAlternative approach to securing cryptoAnnounced on Tuesday by the Concordium Foundation, a Swiss-based development team behind the Concordium layer one blockchain, this “proof of technology” initiative has the potential to fundamentally change how users access and secure their cryptocurrency accounts.Breaking away from traditional methods, the proposed biometric crypto wallet leverages users’ fingerprints or facial scans to generate a set of seed words, eliminating the need for users to store or remember them. This novel approach simplifies the restoration process, allowing users to recover their accounts with a mere biometric scan.Improving UXIf crypto and Web3 are to be adopted by ordinary people en-masse, user experience has long been identified within the sector as an area that still requires development. Making users responsible for the storage of a private key is fraught with difficulty, given the likelihood of private keys being lost or compromised.Various approaches are being taken to solve this issue. Tangem Wallet is one such alternative that utilizes near-field communication (NFC) in combination with an app and a card with an inbuilt chip, negating the need for the user to memorize a private key.This biometric-centered approach from Hitachi and Concordium represents another user-friendly approach to the problem of user authentication, harnessing the power of Hitachi’s Public Biometric Infrastructure (PBI) and Concordium’s self-sovereign identity framework. The result is an account creation process based entirely on biometric data, enhancing both security and user convenience.Complementary technologyConcordium’s network, with its stringent ID process for account creation to combat malicious activities, stands to gain substantial benefits from this technology. The biometric wallet will fortify users’ access to their IDs, a critical aspect of network security. Moreover, the technology’s applicability extends beyond Concordium, offering potential integration with any blockchain network.Users of the biometric wallet will have the flexibility to unlock their accounts either by regenerating seed words through a biometric scan or by decrypting a copy of the seed words. This dual-layered approach ensures that access is granted solely through the user’s unique biometric data, enhancing security and mitigating the risk of loss or theft.Developing this cutting-edge technology poses challenges, particularly in handling the inherent “fuzziness” of biometric data, where no two scans produce identical results, even from the same individual. Hitachi’s team addressed this by employing fuzzy key generation and specialized error correction technology, effectively distinguishing between scans.Unlike traditional crypto wallets that necessitate secure storage of seed words, the biometric wallet by Hitachi and Concordium, alongside solutions like multiparty-computation wallets and magic links, aims to overcome this hurdle. The goal is to resolve the issue of lost backup, a significant barrier to wider crypto adoption.This is not Hitachi’s first foray into the crypto/blockchain space. In mid-November the company announced a collaboration with the Japan Exchange Group (JPX), banking giant Nomura and Nomura portfolio company BOOSTRY to launch a $69 million digital green bond on the blockchain. In October Hitachi joined a consortium of Japanese companies with a view towards developing decentralized identity technology.