Crypto winter continues to take its toll as Coinbase (NASDAQ:COIN) halts its operations in Japan.
Coinbase Global is halting operations in Japan amid volatile market circumstances, the company announced in a blog post on Wednesday. The company provided a deadline of Feb. 16 for Coinbase Japan to withdraw their crypto and fiat assets.
Coinbase Japan Users Must Withdraw Funds by Feb. 16
Crypto exchange Coinbase Global announced Wednesday it would stop operating in Japan due to the persisting market downturn. All Coinbase Japan users must withdraw their holdings from the exchange by Feb. 16. Shares of Coinbasee fell more than 1.3% in premarket trading.
Coinbase wrote in a blog post,
“Due to market conditions, our company has made the difficult decision to halt operations in Japan and to conduct a complete review of our business in the country. However, we are committed to making this transition as smooth as possible for our valued customers.”
Remaining crypto assets held on Coinbase on or after the deadline will be converted to Japanese yen (JPY), Coinbase said. The crypto exchange will then send the remaining JPY to a Guaranty Account at the Legal Affairs Bureau, in line with the legal obligations. Customers who do not withdraw their funds before Feb. 16 will have to contact the Legal Affairs Bureau to get their JPY funds.
The move comes just a week after Coinbase reduced around 20% of its workforce to preserve cash during the crypto winter. 950 employees were affected by the layoffs, the company said in a previous blog post. Coinbase already cut 18% of its jobs in June last year to reduce costs.
The latest layoffs are expected to bring new expenses of $149 million to $163 million in the first quarter. A regulatory filing showed that the job reductions, coupled with other restructuring actions, will slash Coinbase’s operating expenses by 25% for the quarter that ends in March.
Crypto Winter Is Still Freezing Cold
Coinbase’s decision to halt Japan operations highlights the demand for crypto assets slumping following the FTX debacle in November 2022. The crypto market was already on a decline before the collapse of Sam Bankman-Fried’s empire, as harsh macroeconomic conditions and LUNA contagion drove investors away from risky assets, including cryptocurrencies.
The Terra ecosystem and FTX implosions caused a chain reaction, sending numerous crypto businesses into bankruptcy. Companies like Celsius Network, Voyager Digital, Three Arrows Capital (3AC), and BlockFi have all declared bankruptcy in the past year.
Meanwhile, Bitcoin and other cryptocurrencies continue to trade at significant discounts after peaking in November 2021. BTC climbed above the $21,000 mark earlier this week on the heels of a cooling inflation report.
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