Nomura Holdings said it would strengthen risk controls at Laser Digital, its crypto unit, after losses at the business contributed to the company’s 9.7% decline in third-quarter profit, Bloomberg reported.
During an earnings briefing on Friday, Nomura CEO Hiroyuki Moriuchi said the company had implemented stricter position management to reduce risk exposure and limit profit fluctuations due to crypto market fluctuations.
On October 10, four days after bitcoin hit an all-time high of over $126,200, the crypto market suffered a flash crash that resulted in the erasure of over $19 billion in leveraged positions in the largest deleveraging event in the industry’s history. Bitcoin ended the year around $87,000, about 31% below its October peak, and the total crypto market cap fell from about $4.3 trillion to just over $3 trillion at the end of the year, according to data from Coingecko.
“There is a vague sense of unease about the overall direction of the market, and that seems to have combined with the surprise on the crypto front to trigger some selling,” said Hideyasu Ban, senior analyst at Bloomberg Intelligence, adding that it was likely just a short-term market reaction.
Nomura’s net profit fell to $590 million in the quarter ended Dec. 31, the holding company said Friday.
Just three days before Moriouchi announced his company’s crypto risk reduction, Laser Digital said its Americas division filed a de novo application with the U.S. Office of the Comptroller of the Currency (OCC) to create a national trust bank, joining several crypto companies seeking to offer asset management services for the digital assets sector.
