Nomura, the Largest Investment Bank in Japan, Sets Up a Subsidiary for Crypto

Opening New Frontiers

Japan’s largest investment bank, Nomura, has said that it is ready to set up its cryptocurrency arm which is going to be a new subsidiary. The goal of the new company under Nomura is to focus mainly on institutional clients and help them invest in crypto assets and nonfungible tokens.

Going by the news in the media on Tuesday, insider information has it that Nomura is planning to bring a lot of crypto services under the umbrella of the new subsidiary. They said that the company is also planning to hire about 100 people in staff strength to execute these plans by 2023.

Nomura sits high on the list of Japan’s top ten banks. It has up to $569 billion at the end of quarter 1 of 2022, in assets under management.

A media platform in Japan, Nikkei Asia, published a report where it indicated that Nomura’s planned subsidiary is going to be located outside Japan. However, the company’s board would start to be seated via Nomura’s transplants as the company hires its staff from the blockchain and Web 3 space. It is said that Jez Mohideen will be drafted to head the subsidiary at first. Mohideen is currently Nomura’s Head of Wholesale and Digital Operations.

It appears that the bank is feeling a lot more pressured to get more closely acquitted with new developments in the digital assets blockchain technology space. A top executive at the investment bank said to the Financial Times that if they do not embark on this investment at this time, then competition would become more difficult for the company in later years.

A Head-start While Crypto Crisis Rages

For Nomura, the latest decision to expand into crypto services is coming at a very interesting time. Bloomberg had reported last Thursday that the investment bank was starting to offer Bitcoin derivative trading to its clients in Asia. Those trades are carried out on the platform of CME Group, which executed up to 6,944 futures of Bitcoin contracts on the 16th of May.

In addition, the price of crypto assets has gone under on all fronts since there was a major sell-off last week. The sell-off was a direct result of the panic that ensued after Terra crashed and lost its peg to the US Dollar. 

Now, Nomura must fight the possibility of losing a lot of its quarterly gains as a result of a $345 million transaction write-down which the Financial Times equally made a report of on Tuesday. The development was from way back in 2008 during the economic meltdown. Nomura has not clearly declared which transaction had the write-down.

A write-down occurs when there is a cutdown in the value of an asset or a transaction. It might be an act of deliberate fraud. 

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