Zodia Custody, a digital asset storage firm backed by Standard Chartered Plc, has terminated its joint venture with SBI Holdings Inc. in Japan, just two years after its inception. The decision stems from a mutual reassessment of priorities, according to Zodia’s leadership.
As per Bloomberg, Julian Sawyer, CEO of Zodia Custody, stated that, “This is a strategic alignment between SBI and ourselves as a mutual decision that we have other priorities and they have other priorities.”
On February 3, 2023, SBI and Zodia Custody established a joint venture, SBI Zodia Custody, to set up the first tier 1 crypto asset custodian in Japan. However, SBI Zodia Custody, with SBI owning 51% and Zodia 49%, had been preparing to seek registration with Japan’s Financial Services Agency (FSA), but opted to halt the process before submission, Sawyer explained.
Japan’s crypto market has proven challenging for foreign firms due to its stringent regulatory environment. Despite being an early adopter of digital asset regulations in Asia, the FSA maintains a cautious approach, balancing support for blockchain innovation with consumer protection.
This also follows high-profile incidents, including a $300 million breach at DMM Bitcoin in 2024 and the infamous 2014 Mt. Gox hack, which rocked the global crypto industry.
“This dissolution does not represent a retreat in either our custody business or our strategy in Asia,” Kosuke Kitamura, an SBI Holdings spokesperson, clarified to Bloomberg. He also said that, instead, the move is a “proactive decision” to pursue broader synergies within SBI’s digital ecosystem more efficiently.
Sawyer highlighted Zodia’s limited global resources, noting the firm’s recent acquisition of Tungsten Custody Solutions in the UAE as part of its strategic reallocation. The dissolution underscores the complexities of navigating Japan’s tightly regulated crypto landscape, where compliance demands often clash with market entry ambitions.
SBI Boosts USDC in Japan, Zodia Eyes New Crypto Ventures
The decision marks a pivot for both companies as they realign their efforts in the rapidly evolving digital asset sector. Zodia continues to explore opportunities elsewhere, while SBI focuses on its broader digital strategy.
Recently, on August 23, SBI Holding has formed a joint venture with Circle, the company behind USDC, to advance the use of USDC and digital finance services in Japan. Further, on April 3, the crypto exchange Bybit had partnered with Zodia Custody to provide secure trading to its institutional investors.
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