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bitFlyer

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bitFlyer
Company typePrivate
IndustryCryptocurrency
FoundedJanuary 9, 2014
FounderYuzo Kano
Headquarters
Tokyo
,
Japan
Area served
Worldwide
Key people
Kuniyoshi Hayashi, Chief Executive Officer
Websitebitflyer.com

bitFlyer is a private company headquartered in Tokyo, Japan and founded in 2014. It operates one of the largest cryptocurrency exchanges with 2.5 million users[1] and develops other crypto-related technology.

History

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bitFlyer was founded in 2014 by Yuzo Kano, a former derivatives and bonds trader from Goldman Sachs.[2] bitFlyer's cryptocurrency exchange was launched in April 2014, a few months before the once market-dominant bitcoin exchange, Mt. Gox, went out of business.[3] In 2018 the exchange stopped taking new customers after Japanese regulators accused the exchange of not taking actions to stop money laundering and terrorist financing.[4] Regulators stated that most directors were friends of the CEO Yuzo Kano, a former Goldman Sachs trader.[4] By February 2016, it had 100,000 users and was processing about 7 billion yen ($64 million USD) in monthly cryptocurrency transactions, making it the largest Bitcoin exchange in Japan.[5] It raised about $36 million USD in venture capital over three funding rounds.[6] The company established partnerships with retailers, mobile app companies, and payment processors to facilitate smartphone-based cryptocurrency payments at retail locations.[7] bitFlyer also secured regulatory approval to sell cryptocurrency to institutional investors.[8]

bitFlyer expanded internationally to the United States in November 2017 and to Europe in January 2018.[6] By 2018, the company was processing 80 percent of bitcoin transactions in Japan and had grown to 150 employees.[6][9] In 2018, bitFlyer was one of six exchanges ordered to improve their procedures against money laundering, causing bitFlyer to temporarily suspend services while it implemented new systems.[10]

In 2019, bitFlyer created a subsidiary focused on blockchain technology and services.[11]

In May 2023, BitFlyer was fined by the New York Department of Financial Services (NYDFS) for failing to meet state cybersecurity requirements.[12][13] The company was fined $1.2 million.[12]

Services

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Users of the bitFlyer exchange can buy/sell cryptocurrency with each other, or buy/sell directly with bitFlyer itself.[3]

bitFlyer's first service was its cryptocurrency exchange, which was initially focused on bitcoin.[9] The company later added futures contracts and bitcoin derivatives to the exchange.[1][6] As of 2017, 75 percent of transactions on bitFlyer are for derivatives, where users make investments based on their prediction of future bitcoin prices.[14]

bitFlyer first introduced its blockchain technology, called Miyabi, in 2016.[15] In 2019, bitFlyer added other cryptocurrencies to its exchange, such as Ethereum and Litecoin.[citation needed] The company also added features to pay for goods at retailers using cryptocurrency and to buy cryptocurrency using credit cards or points from loyalty programs.[16] In June 2020, bitFlyer introduced a blockchain-based voting service called bvote.[17] The company also introduced a blockchain consulting arm.[18]

References

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  1. ^ a b Popper, Nathaniel (September 1, 2017). "Bitcoin Bug Bites Japan and South Korea as China Clamps Down". The New York Times. Retrieved June 2, 2020.
  2. ^ Williams-Grut, Oscar (January 24, 2018). "Japan's biggest bitcoin exchange saw $150 billion traded in less than 2 months: 'December was certainly an interesting month'". INSIDER. Retrieved June 3, 2020.
  3. ^ a b Alpeyev, Pavel (July 22, 2014). "Ex-Goldman Trader's Bitcoin Exchange to Fill Mt. Gox Void". Bloomberg. Retrieved February 6, 2020.
  4. ^ a b Fujikawa, Megumi (June 22, 2018). "Japan's Biggest Bitcoin Exchange Suspends New Business". WSJ. Retrieved March 16, 2021.
  5. ^ "ビットコイン取引所大手bitFlyerが貫く「経営の王道」". Forbes JAPAN（フォーブス ジャパン） (in Japanese). February 25, 2016. Retrieved June 2, 2020.
  6. ^ a b c d "Japan bitcoin bourse group stages Europe expansion". Financial Times. January 23, 2018. Retrieved June 3, 2020.
  7. ^ Hoshi, Akio (April 5, 2017). "ビットコイン決済が身近に、bitFlyerがビックカメラ2店、Coincheckが26万店展開のAirレジで". TechCrunch Japan (in Japanese). Retrieved June 10, 2020.
  8. ^ Ponciano, Jonathan (November 28, 2017). "With Regulatory Approval, BitFlyer Launches U.S. Crypto Exchange Targeting Institutional Traders". Forbes. Retrieved June 10, 2020.
  9. ^ a b Nakamura, Yuji; Sagiike, Hideki; Hyuga, Takahiko (May 10, 2018). "Ex-Goldman trader Yuzo Kano is hiring old rivals to build a cryptocurrency empire in Tokyo". Bloomberg. Retrieved June 2, 2020.
  10. ^ Varshney, Neer (June 22, 2018). "Japan's biggest cryptocurrency exchange suspends new registrations amidst regulatory clampdown". Hard Fork | The Next Web. Retrieved June 10, 2020.
  11. ^ Skinner, Celeste (May 24, 2019). "bitFlyer Sets Up Blockchain Subsidiary, Names Yuzo Kano as CEO". Finance Magnates.
  12. ^ a b "NYDFS Penalizes bitFlyer $1.2 Million for Violations to Cybersecurity Regulation". JD Supra. Retrieved 2024-03-06.
  13. ^ "Cybersecurity Consent Order Against Cryptocurrency Trading Platform". guidehouse.com. Retrieved 2024-03-06.
  14. ^ "Bitcoin feeding frenzy fuelled by 15 times leverage, says exchange". Financial Times. December 10, 2017. Retrieved June 10, 2020.
  15. ^ Hoshi, Akio (December 21, 2016). "bitFlyerがブロックチェーン技術Miyabiを発表、新アルゴリズムとスマートコントラクト搭載". TechCrunch Japan (in Japanese). Retrieved June 2, 2020.
  16. ^ 拓史, 吉田 (October 12, 2016). "Eコマースはビットコイン普及の呼び水になるか：bitFlyer加納代表". DIGIDAY［日本版］ (in Japanese). Retrieved June 2, 2020.
  17. ^ "ビットフライヤー、株主総会オンライン向け投票アプリ". 日本経済新聞 電子版 (in Japanese). June 9, 2020. Retrieved June 11, 2020.
  18. ^ McIntosh, Rachel (April 27, 2020). "Japanese Crypto Exchange BitFlyer Launches Blockchain Consulting Service". Finance Magnates. Retrieved June 10, 2020.
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