The Invisible Crypto Empire of Japan's Financial Giant SBI

Author: Chloe, ChainCatcher

Japanese financial group SBI Holdings has recently made a series of moves in the digital asset space: acquiring the licensed Japanese exchange Bitbank for 46.7 billion yen (approximately $289 million) within three weeks, leading a $76 million Series C round for the institutional crypto platform EDX Markets, exclusively investing $125 million in DeFi risk analysis company Gauntlet, and announcing a strategic partnership with the Solana Foundation on July 13th to build a domestic on-chain financial market in Japan.

In the past, SBI has mostly deployed in the crypto field through joint ventures, minority stakes, and outright acquisitions, rarely acting as a lead investor in venture rounds. How should the market interpret this accelerated expansion by the traditional financial giant, if we carefully analyze the content, timing, and statements of this series of transactions and collaborations, as well as the evaluations of its strategy by several institutional analysts?

Intensive Moves Within Three Weeks

On June 24, SBI announced the acquisition of all shares of Bitbank through its wholly-owned subsidiary SBICAH for 46.7 billion yen, with the transaction to be conducted in two phases and expected to close around October after approval by the Japan Fair Trade Commission. SBI stated that, based on end-of-April data, the combined customer crypto assets of SBI VC Trade (SBI's proprietary exchange) and Bitbank amount to approximately 1.1 trillion yen (about $6.8 billion), with about 2.92 million crypto accounts, making the post-merger custody asset scale surpass that of bitFlyer and Coincheck and rank first in Japan.

On July 7, the institution-only crypto trading platform EDX Markets announced the completion of a $76 million Series C financing round led by SBI. EDX launched in 2023, with shareholders including Citadel Securities, Fidelity Digital Assets, Charles Schwab, Virtu, Sequoia, and Paradigm. EDX stated that the funds will be used to expand trading, clearing, and settlement capabilities and drive expansion in the Asia-Pacific market.

On July 9, according to a Fortune report, DeFi asset management and risk analysis company Gauntlet completed a $125 million financing round, settled in June this year, exclusively invested by SBI through its US subsidiary, with no other participants in the entire round. This is the largest funding round for Gauntlet since its founding in 2018, more than five times the size of its $24 million Series B round led by Ribbit Capital at a $1 billion valuation in 2022.

The three transactions differ in form, but the common point is that SBI was the sole or primary investor in each, not a follower.

SBI's Crypto Expansion is Not New

The SBI Group was established in 1999, initially as an investment arm under SoftBank, and became fully independent in 2006. The group is currently listed on the Tokyo Stock Exchange with a market capitalization of over $10 billion and is one of the earliest and most proactive traditional financial giants globally to venture into the crypto industry. The company invested in Ripple and formed the joint venture SBI Ripple Asia in 2016, and has since held stakes in companies like Morpho and Circle.

However, in most historical cases, SBI's role was that of a strategic partner, joint venture partner, or acquirer, not a lead investor in venture rounds. Taking the market maker B2C2 as an example, SBI first took a minority stake for $30 million in July 2020, then acquired a 90% stake in December of the same year, making it a subsidiary. This pattern didn't change until this year: when Startale Group completed a $63 million Series A round in March, SBI led the round with a $50 million investment, and Startale was the technical partner that collaborated with SBI three months later to launch the yen stablecoin JPYSC. The exclusive investments in EDX and Gauntlet continue this template of "leading investment equals binding."

What Does Each of the Three Transactions Complement?

Mapping these three transactions against SBI's business portfolio reveals they correspond to three levels: retail, institutional, and on-chain.

Bitbank: The Japanese Retail Market

Bitbank was founded in 2014, and the company claims no hacking incidents since its inception. SBI VC Trade absorbed and merged the Japanese exchange Bitpoint just this past April, and with the acquisition of Bitbank, SBI has integrated two licensed Japanese peers within a year. Against the backdrop of Japan's Financial Services Agency (FSA) promoting the transfer of crypto assets into the Financial Instruments and Exchange Act framework and continuously raising compliance thresholds, licenses and existing customer assets are scarce resources.

SBI stated in the announcement that this transaction will enhance the group's presence, competitiveness, and profitability in crypto and digital assets, with plans to develop new financial products linked to digital assets like stablecoins.

EDX Markets: US Institutional Infrastructure

EDX Markets does not serve retail clients; it provides an institution-only trading venue, with businesses covering central clearing, delivery, and settlement, as well as the FlowConnect service launched this year that allows financial institutions to embed crypto trading capabilities.

EDX has also applied for a national trust bank charter, EDX Trust, from the US Office of the Comptroller of the Currency (OCC). If approved, it will be able to directly provide regulated custody, clearing, and settlement for institutional clients. EDX's current business includes a US spot exchange and a Singapore-based perpetual contract platform for non-US institutions, with the next geographical expansion focus being Asia-Pacific.

Gauntlet: On-Chain Asset Management and Risk Control

Gauntlet was founded in 2018 by former Wall Street quantitative researcher Tarun Chitra, initially providing stress testing for protocols like Aave and Compound, later pivoting to on-chain vault curation business. Vault curation operates similarly to mutual funds: investors deposit assets into vaults to earn yield, and Gauntlet evaluates the risks of yield-generating strategies using quantitative models.

According to the Fortune report, Gauntlet currently manages approximately $1.5 billion in vault assets, with clients including Apollo, Coinbase, and Circle, and its automated platform monitors over $42 billion in user assets. After securing the funding, Gauntlet plans to expand its stablecoin coverage from USD and EUR to include JPY and Mexican Peso.

Stablecoins and the Settlement Layer: From JPYSC to Solana Partnership

Beyond the three transactions, SBI is actively collaborating with Solana to complete its on-chain expansion.

In the fiercely contested stablecoin arena, the SBI Group is accelerating its land grab. On June 24, SBI, together with Startale Group, launched Japan's first yen stablecoin "JPYSC" adopting a trust structure on the same day it announced the Bitbank acquisition. JPYSC is issued by SBI's subsidiary SBI Shinsei Trust Bank and exclusively distributed through SBI VC Trade. Immediately after, the US dollar stablecoin RLUSD, from its long-time partner Ripple, also debuted on the SBI VC Trade platform on the same day after passing the review by Japan's Financial Services Agency.

This means that the critical gateways for the fiat and crypto assets of Japan's three major compliant stablecoins currently (JPYSC, USDC, RLUSD) are firmly controlled by SBI VC Trade. To further expand its on-chain financial ecosystem, SBI also announced it would launch JPYSC lending services starting July 16, offering an annualized interest rate of 3%.

If stablecoin circulation is a land grab, then the strategic partnership between SBI and Solana announced on July 13th extends the battle to the deeper waters of underlying settlement and RWA. The announcement stated that the Swiss-based Solana Foundation will take a stake in SBI's "SBI R3 Japan" entity, which will be renamed "SBI Solana Global." This means Solana will join forces with SBI and Japanese financial giant Sumitomo Mitsui Financial Group (SMFG) to jointly develop Japan's domestic on-chain financial market.

The newly established SBI Solana Global will fully embrace the Solana public blockchain ecosystem. Its key businesses, besides accelerating the issuance of stablecoins like JPYSC, will focus on tokenizing and circulating RWA assets such as corporate bonds, commercial paper, funds, and real estate. Additionally, the team will build a cross-border payment network, institutional-grade on-chain financial services, and lay the next-generation payment infrastructure for the future AI Agent era.

This marriage between traditional finance and a top-tier blockchain has long been in the making. SBI's R3 blockchain alliance partnered with the Solana Foundation in May 2025, positioning Solana as the security verification layer for institutional permissioned chains. Currently, R3's Corda platform manages over $10 billion in compliant RWA. SBI stated plainly that Solana's high scalability, extremely low cost, and global ecosystem are indispensable core infrastructure for on-chain finance. SBI's core mission is to serve as a bridge, packaging Japan's regulated assets and traditional institutional heritage onto Solana's global liquidity behemoth.

How Do the Market and Analysts View This?

This series of actions has sparked considerable discussion within the industry. Several institutional analysts and venture capitalists gave their assessments from different angles in interviews with The Block.

Structural Theory: Buying the "Pipes of the Financial System"

Joseph Goh, Asia-Pacific Head at investment bank advisory firm Areta, believes SBI is doing what other traditional financial groups in Asia have not attempted: building an end-to-end, cross-border digital asset industrial chain spanning issuance, settlement, market infrastructure, asset management, and retail distribution. He characterizes this series of transactions as SBI buying not crypto exposure, but the "pipes" for the next generation of the financial system.

Goh highlights two main lines: In asset management, connecting Gauntlet's institutional-grade on-chain capabilities with the distribution channels SBI controls through Bitbank and Singapore's Coinhako presents an opportunity to become Asia's first scaled on-chain asset management business. In settlement, he believes whoever controls the "yen side" of on-chain settlement may hold the strategic position for Asia's financial future, and JPYSC, USDC circulation in Japan, and the Solana partnership are exactly where SBI is focusing its efforts.

Timing Theory: The Long-Term Logic of Entering in a Bear Market

Other commentators focus on market cycles. GSR Ventures Investment Head Quynh Ho and Neoclassic Capital Co-founder Mike Bucella both believe bear markets are often the best time for long-term positioning because valuations are lower and competition for deals is less intense. Bucella states that playing the long game requires entering at cycle lows, which can bring substantial returns when the market reverses.

Indeed, this round of moves coincides with a backdrop of digital assets declining for three consecutive quarters. Animoca Brands Co-founder and Chairman Yat Siu adds from a regulatory perspective, believing SBI is preemptively securing positions ahead of Japan's impending regulatory shift, rather than acting only after regulations become clear. He also revealed that some large crypto exchanges are being evaluated by traditional financial institutions.

Investee Companies: Valuing Distribution and Access Beyond Capital

The two invested companies focus on "value beyond money." When asked what SBI brings besides capital, Gauntlet CEO Tarun Chitra said it is primarily distribution and market access, as SBI's network in Japan and Asia can help Gauntlet reach financial institutions and tokenization projects it previously couldn't access.

EDX CEO Tony Acuña-Rohter said it allows access to SBI's broader digital asset ecosystem, including market makers, stablecoin initiatives, tokenization, and brokerage businesses, exploring opportunities to jointly advance institutional market infrastructure.

However, the assessments are not uniformly positive. Joseph Goh cautions that "execution and regulatory pace" will be the ultimate determinants of success. However, he also believes that because Bitbank and Coinhako are both regulated, licensed exchanges, and SBI flexibly employs minority equity investments, it has effectively reduced the potential risks of cross-border integration and operation.

SBI's Own Explanation

Regarding why it is making concentrated moves now, SBI told The Block that the group is driving an overall on-chain transformation, aiming to provide a full suite of functions from exchanges and asset tokenization to market platforms, and that recent acquisitions, investments, and partnerships are all part of the group's strategy. Group representative Kefei Lin told Fortune that with US regulatory clarity emerging, SBI will increase its investments and operations in the US this year.

This confidence stems largely from the impending regulatory dividends in Japan's domestic market. Last month, Japan's House of Representatives passed key legislation to incorporate crypto assets into the Financial Instruments and Exchange Act, subjecting them to the same regulation as stocks, paving the way for crypto ETFs, and planning to significantly reduce the maximum capital gains tax from 55% to 20%, aligning with stocks and bonds, by 2028. SBI Chairman Yoshitaka Kitao has repeatedly emphasized: "The shift from traditional finance to on-chain is irreversible. Building trusted infrastructure that reassures investors is the group's top priority."

It's noteworthy that in this round of transactions, SBI unusually chose to "lead invest" rather than "fully acquire" or "joint venture/minority stake." From a business strategy perspective, this is an extremely astute move: the backers of EDX and Gauntlet are Wall Street giants like Citadel, Fidelity, and Apollo. Only by maintaining their "neutral third-party" nature can they continue to attract these giants to collaborate. Through leading investments, SBI secures the strategic high ground of being the "largest single shareholder" without compromising neutrality. Whether this on-chain financial empire assembled by a traditional financial giant will operate as intended is being watched by global markets.