Nomura Holdings said it will tighten risk controls at Laser Digital, its crypto unit, after losses in the business contributed to the company’s 9.7% drop in fiscal third-quarter profit, Bloomberg reported.
During an earnings briefing on Friday, Nomura CEO Hiroyuki Moriuchi said the company implemented stricter position management to reduce risk exposure and limit earnings swings from fluctuations in the crypto market.
On October 10, four days after bitcoin hit an all-time high of over $126,200, the crypto market suffered a flash crash that wiped out more than $19 billion of leveraged positions in the largest deleveraging event in the industry’s history. Bitcoin ended the year around $87,000, about 31% below the October peak, and the total crypto market capitalization fell from about $4.3 trillion to just more than $3 trillion by the end of the year, according to Coingecko data.
“There is a vague sense of unease about the overall market direction, and that seems to have combined with the surprise on the crypto front to fuel the sell-off,” said Hideyasu Ban, senior analyst at Bloomberg Intelligence, adding that it is likely only a short-term market reaction.
Nomura’s net income fell to $590 million in the three months ended Dec. 31, the holding company said on Friday.
Just three days before Moriouchi announced scaling back his firm’s crypto exposure, Laser Digital said its Americas division filed a de novo application with the US Office of the Comptroller of the Currency (OCC) to establish a national trust bank, joining several crypto companies seeking to offer asset management services to the digital asset industry.
