SBI Virtual Currencies: The Bank-Backed Japanese Exchange With Big Plans

Last July, it became the first country to host a bank-owned cryptocurrency exchange, when financial services giant SBI Holdings launched the SBI Virtual Currencies platform.

As SBI's latest financials revealed in April, the exchange has grown rapidly, recording pretax earnings of almost 360 million Japanese yen for the fiscal year up until March 31, 2019.

Beyond a crypto exchange arguably being a logical extension of a Ripple-based remittance service, SBI told Cointelegraph that it ultimately launched SBIVC because it believes in the innovative promise shown by cryptocurrencies.

"As the group's basic strategy, we take an ecosystem approach, in which a business would make synergies with its other businesses. SBI Group fully started its digital asset ecosystem in early 2016, and as part of the strategy, launched SBI Virtual Currencies."

Plans for an exchange weren't only part of an attempt to construct a joined-up ecosystem of financial services, since SBI is firmly convinced that cryptocurrencies offer practical advantages over legacy structures.

"The SBI Group see many possible advantages and benefits that digital assets would bring to the current system," SBI's spokesperson said.

Its delisting of BCH raised some eyebrows, with many assuming that it had something to do with the delisting of bitcoin SV, a fork of BCH that itself had been removed from such exchanges as Binance and Kraken after BSV-affiliated Craig Wright threatened to sue certain individuals for claiming he wasn't "Satoshi Nakamoto." Given that SBI has a business partnership with Wright's nChain, it was suggested that the delisting may have been "Retaliation" for bitcoin SV's delisting.

SBI is set up extremely well as a business to provide a variety of crypto exchange services to institutional investors.

In March, for example, SBI revealed that its MoneyTap payment app, which it had developed in partnership with Ripple, had received investments from 13 Japanese banks.

Added to these developments, CEO Yoshitaka Kitao became an executive of Ripple Labs in April, indicating that SBI and Ripple will extend their collaboration well into the future - and that SBI isn't planning on walking away from crypto anytime soon.