Japanese Bitcoin marketplace lands $1.1M from domestic and US investors

Last night, Japanese Bitcoin exchange BitFlyer announced JPY 130 million (US$1.1 million) in new funding. The latest round included domestic and American investors: Recruit Strategic Partners, GMO Venture Partners, and Barry Silbert’s New York City-based Bitcoin Opportunity Corp.

BitFlyer CEO Yuzo Kano, a former trader at Goldman Sachs, tells Tech in Asia that the investment will be used primarily for marketing and talent acquisition, but some will also be put toward opening new offices in unspecified foreign markets. With Silbert on the startup’s side, an upcoming US operation seems plausible.

The service launched in January 2014, just a month before the closure of Mt. Gox – the world’s largest cryptocurrency exchange before a scandal that saw 750,000 of its users’ bitcoins disappear. Despite the Gox collapse – and the fact that it was also headquartered in Tokyo – BitFlyer is proving to be a trusted alternative. Kano says that the platform sees between BTC 2,000 and 3,000 (US$470,000 to US$700,000 at current exchange rates) in monthly buy/sell orders.

BitFlyer’s relationship with GMO, one of Japan’s largest internet infrastructure companies, is certainly giving it a boost. GMO Payment Gateway (GMO-PG) is Japan’s largest credit card transaction processor, with nearly 50,000 participating merchants. Last September, GMO-PG announced that it would begin accepting Bitcoin for payments, though the final decision on whether to accept them or not is up to individual merchants.

“We do not disclose the number of stores that accept bitcoin,” Takayuki Koretomo, a strategic investment manager at GMO-PG, tells Tech in Asia. “But we are accepting orders from some merchants and getting ready to start bitcoin payment [for others]. We get inquiries from companies – both large-scale and small-scale – and we think that bitcoin is attracting a lot of attention in Japan these days.”

BitFlyer raised US$1.6 million last July and another US$236,000 last October, bringing total investment to approximately US$2.9 million. It faces competition from the likes of US-based Kraken and domestic rival Quoine.

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