Daiwa Securities, a prominent Japanese financial services firm, has recently disclosed its acquisition of a 10% ownership stake in Penguin, a Singapore-based crypto startup. The decision comes amid a notable uptrend in affluent individuals and institutional investors showing interest in the cryptocurrency market.
Penguin Securities is presently awaiting regulatory approval for its operations in crypto trading and broker-dealing services linked to capital market products. Furthermore, one of Penguin’s subsidiaries aims to specialize in offering crypto derivatives.
Daiwa’s collaboration with Penguin aims to leverage its expertise in high-net-worth businesses and provide financial backing to support Penguin’s ambitions in the crypto exchange realm. In return, Penguin will share its knowledge in crypto and alternative assets with Daiwa.
While the financial specifics of the partnership remain undisclosed, reports suggest that Daiwa has invested over 1 billion yen ($6.65 million) in Penguin, securing a stake exceeding 10% in late February.
Penguin aims to roll out crypto derivatives by the end of 2024 and expand its services to encompass crypto exchange and brokerage operations.
Kentaro Kawabe, CEO of Penguin Securities HD, expressed optimism about the collaboration, highlighting the potential to foster a robust business partnership with Daiwa Securities Group. The goal is to accelerate business expansion in Asia and globally while sharing expertise on crypto assets to co-create a next-generation financial ecosystem.
In a broader context, Japan has embraced cryptocurrencies as pivotal components of fintech progress. Recent legal changes permit domestic venture capitalists to invest in Web3 startups, including those involved in virtual currency issuance.
Daiwa’s venture into the crypto space is not new. Last year, it invested in pafin, the company behind cryptact, a service for crypto accounting and profit calculation. Moreover, Daiwa participated in issuing digital bonds using blockchain technology earlier this year.
The firm has been actively engaged in crypto and digital securities projects since 2016, and its subsidiary, Fintertech Corp, commenced offering Japan’s first crypto asset-backed loans in 2020.