A quote best summed up the rationale. “If we don’t have the means to invest in tokens, we will not be able to invest in Web3 companies that mainly raise funds with tokens,” said Takeshi Goto, an EVP at SBI Investment, a venture subsidiary that also plans to set up a fund to invest in tokens this year.
In other countries, it’s now common for venture capital firms to invest in startup cryptocurrency tokens either in addition to equity or instead of it. A16z crypto, part of Andreessen Horowitz, is the highest profile and recently raised a fourth crypto fund of $4.5 billion. Its previous crypto funds totaled $3.1 billion.
While conventional venture investment uses similar skills to token investment, they aren’t quite the same, given that tokens don’t represent equity. So it’s a learning curve for investors.
SBI has established relationships with other major digital asset venture investors in Asia. For example, it has a deal with Standard Chartered’s SC Ventures to create ecosystems for startups. And Siam Commercial Bank’s SCB 10X has invested in SBI Digital Markets, which will target security token issuance in Southeast Asia from Singapore.
Separately, in May, Nomura confirmed plans for a digital asset subsidiary to target institutional clients. SBI and Nomura have other collaborations in the blockchain sphere. Nomura is a minority investor in SBI’s Osaka Digital Exchange, which plans to launch a secondary market for security tokens next year. And SBI is a minority investor in BOOSTRY, a Nomura security token issuance company that has its “iBet for Fin” platform (nothing todo with betting).
SBI already has significant cryptocurrency interests. SBI VC Trade is its cryptocurrency exchange. It also has a substantial interest in Bitcoin mining. In 2020, SBI acquired major institutional market maker B2C2 and this May announced plans to take a controlling interest in another local exchange, BITPoint. It previously acquired TaoTao from Yahoo Japan.