Prominent cryptocurrency exchange Coinbase is winding down its operations in Japan after firing more than 950 people in one of its latest round of job cuts.
“Due to market conditions, our company has made the difficult decision to halt operations in Japan and to conduct a complete review of our business in the country,” the exchange said.
In a blog on Wednesday, the exchange said it will terminate transactions with current users, who have until February 16th to withdraw their assets from the exchange.
“All Coinbase, Inc. customers can withdraw fiat currency and cryptocurrency holdings from Coinbase by February 16th,” the company said.
Coinbase users can either sell their holdings or withdraw Japanese Yen to their local bank account. They won’t be able to make fiat deposits after Jan. 20. Once the deadline passes, remaining assets will be converted to local currency then deposited with the Legal Affairs Bureau in line with the law.
Industry competitor, Kraken, announced in late December that it too would pull out of Japan by the end of January, saying the resources were not justified at the time. Coinbase laid off over 2,000 people last year as exchanges navigated a deadly market, with lower activity and revenues intensifying the crypto winter.
The company’s stock price has been vulnerable to periods of high volatility.
S&P Global recently downgraded Coinbase’s long-term credit rating, citing slow trading volumes and rising regulatory risks. Meanwhile, Cathie Wood’s Ark Invest bought 33,756 Coinbase shares in December. The purchase was up 22% by January 11th.
BTIG analysts said in a Jan. 16th note that various factors could boost the company’s stock price this year. In fact, the company’s market share is said to have increased 29% in October, to 39% in December following the FTX blowout.
“Our bullish thesis for [Coinbase] shares at this point is anchored by two beliefs: that the company’s liquidity should provide it with the runway it will need to support its operations until the next digital asset bull market begins, and that its status as a safe haven will enable it to emerge from the ongoing shakeout within the crypto exchange space in a position of strength,” BTIG analysts Mark Palmer, Andrew Harte, Thomas Smith wrote.
Exchange shares are down 76% over a 12-month period, but are up 43% in the last week alone, per TradingView data.
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