- Nomura, Japan's largest investment bank, plans to launch a crypto-centered company for its institutional investors.
- Meanwhile, crypto markets are back in the red after recovering over the weekend.
NEW DELHI (CoinChapter.com) — Nomura, Japan’s largest investment bank plans to launch a new crypto subsidiary, according to a Financial Times report.
The firm, Japan’s largest investment bank, aims to provide its institutional clients an option to diversify in the cryptocurrency, DeFi, and NFT markets. As per the report, Nomura will combine several digital asset services under a single subsidiary.
The new company will have a staff of nearly 100 employees by 2023, FT reported, citing unnamed Nomura executives with knowledge of the project.
Nomura’s executives will run the new company, but the new company’s employees will mostly be new hires. Furthermore, Nomura’s new venture would help the Japanese investment giant join other global financial institutions that have already been active in the crypto markets.
Cryptocurrencies have attracted significant institutional interest over the past year, with several financial institutions launching crypto-based trading products. Moreover, Bitcoin futures-based ETFs, crypto spot ETFs and other investment vehicles are attracting increased institutional investor attention.
If we don’t do this, then it’s going to be more difficult down the line to be competitive. […] many managers will be looking and thinking about potentially allocating towards blockchain technology and blockchain opportunities.A Nomura executive told Financial Times
However, this isn’t Nomura’s first brush with the cryptocurrency markets. The firm recently executed its first Bitcoin futures and options trades futures exchange CME.
Additionally, Rig Karkhanis, Nomura’s head of global markets in Asia, noted that options trading would help investors trade volatility directly with lesser risk exposure. However, Nomura’s plans come in the wake of a crypto hell week that saw several major cryptocurrencies’ prices plunge.
Jez Mohideen, Nomura’s chief digital officer for its wholesale business, will head the yet unnamed firm.
Crypto Markets Stumble After A Brief Recovery
Meanwhile, the cryptocurrency market staged a recovery over the weekend, before traders moved in to recoup some of their losses on Monday. The crash pushed the total crypto market cap to $1.08 trillion on May 12, its lowest since Feb 2021.
On May 16, the total crypto market cap lost nearly $97 billion before recovering slightly. Investors are hoping that the recent market tumult is only a correction.
However, with Bitcoin plunging below $30,000 for the first time in months, and altcoins following in lockstep several investors have suffered significant losses. Additionally, Tether (USDT), the largest stablecoin by market cap, failed to maintain its peg to the U.S. dollar due to the downtrend.
As such, Nomura’s recent announcement might not garner the interest that the firm hoped.
At the time of writing, the total crypto market cap was at $1.26 trillion, down 5.13% on the day.