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Monex CEO Compares Cryptocurrencies to Initial Stages of the Global Derivatives Market

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Monex CEO Compares Cryptocurrencies to Initial Stages of the Global Derivatives Market

Oki Matsumoto of Monex Group, a Japanese securities trading firm, has compared the cryptocurrency market with that of derivatives. He recalls how derivatives were on the receiving end of criticism thirty-eight years ago by regulators, only to gain widespread adoption in the years soon after.

Current Cryptocurrency Market = Initial Stages of Derivative Market

Drawing a comparison between derivatives and crypto, Matsumoto spoke about the confusion caused by the two in the early days on May 1 at the Japan society in New York. However, with an increased number of reports of regulated and institutional companies expressing interest in cryptocurrency investments, Matsumoto believes that confidence has been boosted in this space.

According to Matsumoto, “history will repeat itself,” with the gradual introduction of a regulatory framework for cryptocurrencies across the world.

Matsumoto started out his career at Salomon Brothers in the derivatives division in 1987 and then moved on to Goldman Sachs, where he worked with the investment bank for 12 years. During his tenure, the trading veteran launched a yen fixed-income trading desk at Goldman.

Currently the CEO of Monex, which was launched in 1999 in a partnership with Sony Corporation, Matsumoto recently led the company’s acquisition of the infamous crypto-exchange Coincheck, which was the unfortunate victim of a $534 million crypto-hack in January 2018.

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However, the CEO maintains a composed outlook and looks forward to working “beautifully together” with Coincheck. As a result of the deal, his company Monex experienced a rise in share prices by 50 percent at their peak.

High Tax Rate Remains an Unwanted Obstacle

A major hurdle for crypto investors in Japan is the tax rate. Investors end up shelling up to 55 percent on crypto in Japan. The traders, on the other hand, are unaffected by this.

Matsumoto said:

“You don’t drink thinking about getting hungover the next day. I think it’s going to take time for Japanese retail people to move a good portion of money into crypto.”

The cryptocurrency market’s price volatility and high-return rates lure many investors to the risky sector, which boasts of the magical “10x” return possible in an extremely short period. In contrast, a 10x return in the traditional equity markets  – colloquially called a “ten-bagger” – is a blue moon occurrence.

Cryptocurrency Education an Imminent Need

Matsumoto further expressed his thoughts on cryptocurrency education, which is bound to increase in proportion to the growth of the digital asset market:

“Only a few people could understand derivatives, just the rocket scientists and those people. But five years later, all the biggest schools in the world were teaching derivatives.”

As reported by BTCManager, the rise in demand of crypto education is undoubtedly required, evidenced by the launch of cryptocurrency-focused courses in some of the world’s top universities, such as Stanford and Wharton.

On April 27, 2018, Binance signed a MoU with the government of Bermuda, pledging a total of $15 million towards cryptocurrency education and blockchain education in the region.  

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