Japanese online brokerage firm Monex Group is reportedly looking to take over Tokyo-based cryptocurrency exchange Coincheck, which earlier this year saw hackers take $530 million worth of NEM from its wallets.
After Coincheck lost its clients’ NEM to hackers, Japan’s Financial Services Agency (JFSA) ordered the exchange to overhaul its operations so as to protect user funds and implement anti-money laundering measures.
According to Japanese financial publication Nikkei, Monex is considering offering “several billion yen” for a majority stake in the cryptocurrency exchange. The firm’s goal would be to install a new management team and rebuild Coincheck under its supervision.
The potential acquisition may be one of the factors behind bitcoin’s ongoing recovery. In the last 24-hour period, the flagship cryptocurrency is up by 5.09 percent, as it is currently trading at $7,400 according to data from CryptoCompare.
Monex’s shares have also surged on the news, as the company’s shareholders are seemingly looking forward for the acquisition. The company’s shares are up 23 percent in the last 24-hour period on the Tokyo Stock Exchange.
The deal itself may imply Coincheck found it difficult to comply with JFSA’s demands and rebuild its operations without external support. Notably, Monex may help Coincheck by having its founding president and chief operating officer (COO) steop down. Nikkei’s report reads:
“Coincheck founding president Koichiro Wada and chief operating officer Yusuke Otsuka are expected to step down once Monex takes control, though they will remain as shareholders. Monex will appoint a new president and other executives.”
The deal, Nikkei claims, could be announced soon. Monex has recently issued a press release confirming it is considering the acquisition, but that the move hasn’t been finalized. The acquisition would still need to be approved by the JFSA and Monex’s shareholders.
Since Coincheck’s hack, Japanese regulators have been strict when it comes to regulations, which may have been keeping Monex away from the cryptocurrency exchange business. Buying the Tokyo-based exchange may be the brokerage firm’s solution, as it can help it acquire a license with the FSA, while allowing it to access Coincheck’s client base and information systems.
Coincheck itself hadn’t been licensed by the JFSA at the time the hack took place. The regulator is now expected to examine how a partnership with Monex could help the exchange’s operations.