SBI Holdings or the Strategic Business Innovator Group is a financial services group based in Tokyo, Japan.
The company seeks to launch a Japan-based cryptocurrency fund later this year.
The fund will seek exposure to key cryptocurrencies such as Bitcoin, Ethereum, XRP, Bitcoin Cash and Litecoin.
What did SBI Holdings announce?
The Strategic Business Innovator Group has recently announced its decision to launch the first Japan-based cryptocurrency fund. This fund will seek exposure to key cryptocurrencies in the space including Bitcoin, Ethereum, XRP, Bitcoin Cash and Litecoin.
SBI Holdings aims to get approximately $700 million assets under management for the cryptocurrency fund. This aim is quite possible as it is the first Japanese fund. Thus, every passive investor looking to gain access to the cryptocurrency market will invest their money in the fund. Due to this objective, the fund may impose certain minimum investments required from investors. This minimum legislation may range from $9000 to $27000. However, the company is yet to give the details for the establishment of this fund.
SBI Holdings has explicitly mentioned that this fund would only be for investors who understand the risk of investing in cryptocurrencies. These digital assets are subject to major price fluctuations due to change in trends. As recently witnessed, all coins fell by 50% to 80% during the May crash.
Thus, the fund may set up some guidelines and terms and conditions to make investors aware of the risks that are attached with cryptocurrencies. Only after all the terms are agreed, will the investors be able to invest in the cryptocurrency fund.
Why was this fund launched?
President of an SBI affiliated company, Tomoya Asakura is a firm believer of cryptocurrencies. Thus, the company intends to launch the cryptocurrency fund owing to his firm belief. Tomoya Askaura is of the opinion that cryptocurrency’s diversification benefits far outweigh its speculative purposes. Thus, owing to this statement, the fund will be focused on investing in multiple assets such as Bitcoin, Ethereum, XRP, Bitcoin Cash and Litecoin instead of investing in only one cryptocurrency.
Owing to his passion for investing in cryptocurrencies, Tomoya added that the company has launched the first fund to see the response it receives from investors. If the fund succeeds in gathering massive investments, the company will not waste time in launching a second fund, focusing on a different combination of cryptocurrencies.
Asakura also said that
Once people feel it firsthand, they will understand that we aren’t recommending cryptocurrencies as a tool for speculation.
Why did SBI group not launch the fund earlier?
Due to the tight regulations in Japan for cryptocurrencies, it took four years for the SBI group to get the fund off the ground. After all the failed attempts at launching the fund, the SBI group finally established an anonymous partnership to accomplish its project.
In 2019, the Japanese Financial regulator tightened the regulations imposed on cryptocurrencies. The regulator exercised various restrictions on cryptocurrency exchanges due to a major theft in 2018.
In addition to this, the Japanese Regulator also prohibited firms from selling cryptocurrencies through trusts and funds. This regulation dealt a severe blow to the development of cryptocurrencies as it was a popular method of conducting transactions in Japan. SBI had initially planned to form its fund through this method before the Japanese regulator banned it.
Despite the tight regulations, SBI holdings did not give up its project as the popularity of cryptocurrencies in Japan grew at an exponential rate. The cryptocurrency transactions in the first half of 2021 peaked at 77 trillion yen.