GMO Internet Inc., the Japanese IT services conglomerate, have announced their entry into the Bitcoin wallet market. In an official Japanese language statement on their site they explain their reasons for entering the sphere on their estimation that the market will reach “1 trillion yen ($8.78 billion) in the next few years.” They also acknowledge the clearance of Bitcoin as an official currency by the Japanese government, and the planned elimination of the Japanese consumption tax on cryptocurrency.
The GMO Internet group, founded in 2002 but with a history stretching back to the late 90s, offers services including cloud hosting, domain registration and electronic security certificates to Japanese businesses. As well as creating the IT infrastructure for other businesses, they own the world’s largest Forex platform Z.com. Alongside the BitWallet project announcement, they stated that they will soon open their own internet bank. It seems as though these moves are part of a bigger plan for GMO to dominate the financial sector in their region.
The entrepreneurial boom in Japan has been good news for Bitcoin. Until recent years, Japan was not known for its business innovation. It is thanks, in part, to GMOs top-to-bottom support of Japanese startups that $1.2 billion of funding flowed into the coffers of entrepreneurs in 2015. Now that the Japanese government catching up with the newfound innovation, it seems that GMO is one of the first big movers trying to benefit from the changes in regulation.
The Japanese Financial Services Agency announced in 2016 that Bitcoin can be defined as having property value – as apposed to being classified as a commodity or service – under the revised fund settlement law. This opened the crypto currency up for use as currency within alternative payment instruments. GMO referenced these changes as directly supporting the business rationale for their BitWallet endeavour.
The recent expansion of Bitwala, a European based payment solution provider, is also paving the way for the use of Bitcoins; which are now accepted at over 2,500 Japanese brick and mortar stores. That is a quadrupling compared to the same period 12 months ago. GMO though, has an even bigger potential reach. They are already the number one company for credit card processing, working with over 48,000 online stores. And, this is not GMO’s first foray into handling bitcoin. In 2014, they added support for bitcoin payments alongside standard payment options like credit cards and bank transfers through their online Payment Gateway (“GMO-PG”) service.
GMO state that their BitWallet will benefit from their expansive knowledge of internet and business security. They plan to collaborate with local businesses to offer a new level of convenience for those wanting to carry out transaction with bitcoin. With their Forex experience it seems quite likely that GMO Internet Inc. will continue to make moves in the Bitcoin sphere. Perhaps we will soon see the return of a major bitcoin trading platform in Japan. Let us hope that GMO can maintain their security reputation so that there is no repeat of the MtGox fiasco.