Exchange

The world's biggest bitcoin exchange by trading volumes is opening its doors in Europe for the first time amid a major boom in cryptocurrencies.

BitFlyer initially launched in Japan in 2014 and in the US late last year, with $250bn worth of cryptocurrency trades going through the platform in 2017.

Read more: Capital One has banned customers buying bitcoin with credit cards

It has now set up shop in Luxembourg where it has been granted a Payment Institution Licence, the first exchange to gain such authorisation.

While exchanges can operate without a licence, European operating chief Andy Bryant told City A.M. the company wants to set a global standard and help add respectability to what has been a highly volatile market.

Initially for "sophisticated" professionals trading high volumes from euros, it plans to expand its services including the addition of other cryptocurrencies such as ethereum and litecoin later in the year. It is also eyeing other countries outside the eurozone. Traders will have access to cross-border trading with Japan, which has become the largest bitcoin market in the world. "Deep markets are important," said Bryant. The euro is the third biggest bitcoin market in the world after the yen and dollar.

“When I set up BitFlyer in 2014, I did so with global ambitions and the belief that approved regulatory status is fundamental to the long-term future of bitcoin and the virtual currency industry," said founder and chief executive Yuzo Kano, a former Goldman Sachs banker.

"I am proud that we are now the most compliant virtual currency exchange in the world; this coveted regulatory status gives our customers, our company and the virtual currency industry as a whole a very positive future outlook.”

Read more: Bitcoin is a mere drop in the ocean of blockchain opportunities

BitFlyer is also working on its own blockchain called Miyabi with involvement of the Japanese Bankers Association.

Authorities in many countries are now looking at if and how cryptocurrency should be regulated, but they are moving in the right direction, said Bryant. "It would be pretty short-sighted to come out with a ban," he said, adding that he also expects volatility to decrease.