BitMEX and one of the Wine Companies listed on Stock Exchange in Hong Kong, are planning to collaborate with the new Japanese Cryptocurrency Exchange
Dec 27, 2018 · 3 min read

The BitMEX a Cryptocurrency Exchange and a French quality wine retailer have teamed up to acquire a majority stake in the Japanese, BitOcean Exchange, which is already licensed but still inactive. Japan’s Cointelegraph reported on the possible partnership on December 21.

Madison Holdings Group, currently listed on the Growth Enterprise Market (GEM) of the Hong Kong Stock Exchange, is allegedly planning to acquire a 62.7 percent stake in BitOcean for 1,680 million yen (USD 15.12 million) — paid to existing stakeholders — plus a further USD 15 million in additional fees. Still incomplete agreement, says to be done through a subsidiary, Madison Labs, in accordance with Madison’s presentation to GEM earlier this month.

The Cryptocurrency Exchange, BitOcean, is officially registered with the Japanese regulator, the Financial Services Agency (FSA), although it has not yet started operating with its trading services.

The agreement with BitOcean occurs in parallel with plans for the acquisition of Madison Labs by the parent company of the main cryptocurrency rading platform, BitMEX. According to a report in the Hong Kong South China Morning Post (SCMP) on December 26, HDR Cadenza Management, a subsidiary of the owner of BitMEX HDR Global Trading, is considering acquiring a 51 percent stake in Madison Labs at a cost of $17.14 million.

As CT Japan reports, if and when both agreements are concluded, the move would make BitMEX an indirect partner and shareholder in Madison’s entry into the crypto- market. CT Japan writes that Madison’s joint venture into BitOcean with HDR will aim to leverage BitMEX’s technology and accumulated knowledge related to the establishment of a commercial infrastructure of enterprise- grade derived from cryptocurrency.

Currently, BitMEX is offering a cryptocurrencies futures and indefinite contracts, as well as leveraged operations. This regulation is under discussion in the country, as CT Japan points out.

Raymond Ting Pang-wan, Madison’s president, told SCMP that the company had opted for an investment in BitOcean because of its approved licensing status and robust regulatory framework for the country’s cryptocurrencies. Further, Ting told SCMP that while Madison’s wine business is stable and profitable, it is difficult to scale, pointing out that:

“That’s why we have to diversify into financial technology and the cryptocurrencies business in order to achieve better returns for our shareholders”.

He also added that as the cryptocurrencies and Blockchain become “more popular,” as a result of entrance to sector which will allow the company to “expand” its source of income.

As previously reported, Japan has both a self-regulatory body, the Virtual Foreign Exchange Association (JVCEA), and a comprehensive procedure of Cryptocurrencies Exchange operators to acquire an FSA license. The organization has exercised intensified oversight of the sector since the USD 532 million hack, which broke the industry record last January, on the national trading platform Coincheck.

Although licensing has been mandatory for all Cryptocurrencies Exchange operating in Japan since the amendment of the country’s Payment Services Act in April 2017, the FSA increased requirements for applicants throughout 2018; about 200 operators are reported to be currently waiting for a license.

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