Kesuke Amo AMA: Coincheck and Japanese Crypto Exchanges

May 15, 2020

Today, we hosted an AMA with Kesuke Amo from Coincheck. The AMA took place in our official WeChat group. It was hosted by TEAMZ CEO Tianyu Yang.

Below are the questions and answers to the AMA.

Let’s Begin…

Tian: When did you start paying attention to crypto assets? When did you officially join Coincheck team?

Kesuke: The first time I got to know BTC is 2015 when the company I was working for invested in crypto exchange. So I did some research on crypto assets and I feel like this would be a new revolution since the emergence of Internet.

In 2017, I joined Coincheck. Japan has the world’s second largest trading volume. Meanwhile, Japanese crypto exchanges were developing rapidly, among which Coincheck was the No.1.

Back to the Internet revolution, I was a primary school kid. Now as a businessman, I am so excited to witness this industry revolution.

Tian: Amo was just promoted to the Executive Director at Coincheck. Congratulation on your promotion! So, what are you responsible for and what’s your future plan?

Kesuke: Thank you so much.

I am responsible for new coin listing and business development, as well as relationship management with FSA (Financial Services Agency) and with other institutions. Recently, I am trying to list more token as I can, as to let more people engaged in this space. At the same time, we are creating new business ecosystem for the future. Although regulation in Japan is strict but the environment is becoming better, we’re closely watching regulation, as well as exploring new business chances.

Tian: Japanese crypto market has always been paid close attention to by the world. What’s your thought on the current Japanese crypto industry? What kind of challenges and opportunities you think it is facing?

Kesuke: Well, it’s all about blockchain technology. With the discussion between FAS and other institutions going on, Japanese law divided it into 4 areas, which I think will be clearer in 2020.

  1. Crypto currency
  2. Digital fiat currency
  3. Security token
  4. Non-fungible token

Coincheck is an exchange providing the first service, crypto currency. Coincheck belongs to Monex Group, a public company which owns several domestic and overseas companies. Our group is also thinking about STO. We have Top 3 American trading platform, and BOOM security in HK. We may think about cooperate if necessary.

Tian: Japan has the most regulated exchanges (22) on the world. Japanese regulations have been highly accepted by global crypto market. Or we can say that, if we choose 2 words to describe Japanese crypto market, that’d be—highly regulated and supervised. However, do you think strict regulations will restrict business development, especially for exchanges holding licenses? What’s your thoughts on FAS’s regulation policies?

Kesuke: Just like you said, Japan make strict rules to protect users.

At the current state, the regulation all over the world has been getting more and more strict. I think sooner or later, other countries will also enact rules, just like Japan.

Rules are strict, that’s true. But in other word, it means high entry barrier. Because Japan has a large market, I think as long as you play with the rules, there’re plentiful business opportunities just in Japan.

Coincheck is providing crypto currency trading service. In the last year, as rules of coin listing and ICO have been improved, we’ll continue to develop new business, with the cooperation with FSA and industry institutions.

No matter what, under the current highly uncertain situation, I think it’s important to keep updated with the latest information and continuously adjust the development strategy.

It may seem tough from an outside. But trust me, if you spend time on acquiring and piecing together new information, you’ll find new business opportunities!

Tian: Coincheck received FSA license in January 2019. Could you please share with us about steps of applying for licenses in Japan? things that people should pay attention to?

Kesuke: First you need to join JVCEA, a self-regulated organization authorized by FSA. You’ll have to prepare necessary paperwork and modify the system as required. I personally don’t think there’ll be many new licenses issued. Given that some International companies may interested in entering Japanese market. For them, maybe M&A is an easier way. Well, if you are really interested, come and talk to me, I can help lol.

Tian: Coincheck has established for several years. It can be said as a model exchange in many respects such as registered users and trading volume. It takes time to earn trust from Japanese users. Additionally, new business always comes along with doubt and uncertainty. How does Coincheck manage to eliminate the uncertainty? And what great result it has achieved so far?

Kesuke: Coincheck started crypto currency trading service since 2014. After that, we expand our services along with the rapid growing market. I think it’s because we invested in advance, we were able to catch the boom. In 2018 January, the hacking caused by unauthorized access brought many troubles to our clients, we’re sorry for that, but we managed to reimburse our clients by 58 billion yen. Additionally, after that we spent one year to improve the security.

Based on that, we started new tokens listing and other new services. With our clients’ support and trust, Coincheck App download become Japan NO.1 in 2019.

Development in this space is very fast, with a lot of uncertainties. We can’t predict when the next boom will come. If you react after the boom come, you might miss the best timing. Therefore, from mid to long term, it’s necessary to be prepared and make a bet beforehand.

Coincheck’s listed token number is No.1 in Japan. After new rules come out, 4 new tokens listed on Japanese exchanges last year. 2 of them first listed on Coincheck. Also, we are the first one to Lisk staking service, which I think it’s a pioneering movement in the space.

Tian: According to 2019 market report, there 6.45million traders in Japan, and west Japan traders are very active. Coincheck’s users are mainly located in east Japan or west Japan? How does Coincheck attract new users?

Kesuke: Most users are located in Tokyo. To attract new users, we are mainly using digital marketing. In the future, we are also thinking doing TV commercial and other new channels.

Tian: Local Japanese exchanges such as Bitflyer, GMO, Liquid keep trying new business to expand their local influence. Bitpoint is also actively exploring oversea markets. Compared to those competitors, what are Coincheck’s advantages and core competitiveness? Does Coincheck plan to enter global market?

Kesuke: Coincheck has 2.8 million download volume, No.1 in Japan, which means we have the largest user group base. We also have the most listed tokens and excellent UI UX design.

Furthermore, we’re preparing for new service, now I can’t give too much details. About bitFlyer and GMO coin, their main income is from leverage trading. To distinguish from them, our future business would focus on services that you can find only in crypto.

Additionally, Monex Group has bases in America and HK. American TradeStation is also running crypto trading business. We are very confident about business expansion in overseas market.

Tian: Due to previous regulation, exchanges were not allowed to list new token. But since last year, regulation has become relatively loose. Coincheck also listed new tokens–Monacoin, Stellar, Lumens and Qutm.  Can you share with us about Coincheck’s listing plan of 2020? How many new tokens it’s planning to list?

Kesuke: Of course. I am not sure about the exact number though; we’re working to list more coins. Different from global market, despite that Coincheck list most coins in Japan, but just 12 coins. I’m not saying the more the better, but the current coin number is far from enough.

Tian: Well, the next question might be the one that audience most care about. If a project is planning to list on Japanese exchanges, let’s say Coincheck for example. What’s the step? What they need to prepare at the beginning stage? Can you talk about process length, cost, and the do’s  and don’ts?

Kesuke: Basically, censorship can be divided into 2 parts. One is to meet the standards made by Japanese crypto currency self-regulated institution, and another one is Coincheck’s self-checking. To protect users and avoid AML, gambling coin, coin that may occur privacy issues, low liquidity coin will not be considered. Other than that, Japanese self-regulated institution has more than 70 checking items.  Questions are not difficult to answer, but it still takes time to fill all of them.

As exchange, we will research, check their code and ask them to fill application form. We’ll have 2 departments to check the company background and internal operation. Then submit censorship materials to Japanese self-regulated institution. If it were passed censorship, we’ll be preparing for listing, follow-up and development. The overall process would take at least 4 to 5 months.

Here’re the reasons why we have the most clients in Japan, and why you should list on Coincheck.

  • Coincheck has the most coins in Japan.
  • Large user group
  • We have a department designated for new coin listing
  • Last year’s listing experience equips us with expertise and knowledge
  • Japanese trading volume tops in the world

Tian: We just discussed with Bobby Lee, CEO of Ballet on BTC price movement after halving and global fiat inflation, which will draw new traders to join crypto world. So what strategy will Coincheck use to attract new users?

Kesuke: We are looking for business opportunities not only during halving but anytime. The current Japanese market is focusing on regulation, so we’re focusing on that too. Collect firsthand information, analyze and piece together. We’re devoted ourselves to provide service before any other competitors.

Tian: Since last year platform token has been a topic for oversea exchanges. What’s Coincheck’s attitude towards platform token? Will Coincheck issue its own token?

Kesuke: Yes, we’re doing a lot of market research on platform token. Last year only 3 platform tokens were permitted in Japan. We’re now focusing on trading service, but we’ll have more services coming in the future. Our own original token and technology will be our future core service.

Tian: We are all concerned about security of exchanges. How does Coincheck strengthen the platform security? How does it protect users from hackers?

Kesuke: Japan has very strict regulation rules. Each licensed exchange will allocate a large amount of budget on system security. Once the exchange is hacked, it has to reimburse users and exchange need to set aside part of funds to prepare such accidents.

Thank you for inviting me.

Japanese crypto market has solid regulation foundation and is growing steadily.

If you’re interested in Japanese market or Coincheck, please contact us by [email protected]

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