Japan’s Line, the messaging app popular in one of the world’s largest cryptocurrency markets, is preparing its own exchange for Bitcoin and its ilk starting next month.
Line, the chat app ubiquitous in Japan with an estimated 200 million monthly active users worldwide, said it will launch a cryptocurrency exchange dubbed BitBox likely in July. The exchange will handle 30 or more cryptocurrencies, including Bitcoin, Ethereum, Bitcoin Cash, and Litecoin.
“The above-mentioned cryptocurrencies were selected through a rigorous review by a listing committee composed of experts,” Line’s press release reads.
But here’s the catch: BitBox does not plan to offer its services in its home base of Japan, or in the U.S. Nor will it allow users to trade fiat currencies such as the U.S. dollar or Korean won for cryptocurrencies — restrictions that will likely shrink its potential user base. Japan is by far the app’s largest market.
That comes amid stronger regulatory oversight from both U.S. and Japanese governments into the cryptocurrency exchanges in their countries. Japan’s financial regulator, the Financial Services Agency, has punished several exchanges in recent months for inadequate internal controls. That came after the theft of millions of dollars worth of cryptocurrency from Japanese exchange Coincheck in January.
Exchanges in the U.S. have also stepped more carefully in recent months, after the Securities and Exchange Commission clarified that cryptocurrency exchanges seeking to trade digital assets that may be considered securities must register with the SEC.
Line’s decision to add a new feature also comes at a time when its own user base has been shrinking. While the company’s user base in Japan has grown from 68 million to 75 million in the past year, that same metric has fallen from 103 million to 90 million in its three other key markets: Taiwan, Thailand, and Indonesia.