Photographer: Kiyoshi Ota/Bloomberg

Line Plans Expansion Into Crypto Trading and Insurance

  • Japan’s biggest messenger creates a financial holdings company
  • Line applied for cryptocurrency exchange license in Japan

Line Corp., Japan’s biggest messaging service, is expanding into cryptocurrency trading, insurance and other financial services, according to people familiar with the matter.

The company established a financial holdings firm and plans to launch the offerings in its main Asian markets and beyond pending regulatory approval, the people said, asking not to be named because the information is private. Line has already applied for a license to open a cryptocurrency exchange in Japan and is planning to expand to Hong Kong and Luxembourg.

Since Line’s listing in July 2016, the company has scaled back its global ambitions to focus on markets where it already has top share -- Japan, Taiwan, Thailand and Indonesia. Faced with a stagnant user base, Chief Executive Officer Takeshi Idezawa has set out to transform the messaging app into an all-in-one communications and entertainment service over the next five years. He has centered it on video and everyday services powered by artificial intelligence. Adding financial offerings may help reduce the company’s reliance on advertising revenue and offer a way to gain subscribers in countries dominated by Facebook Inc.’s Messenger and WhatsApp.

The services may be offered under Line’s own name or as a stand-alone brand, the people said. The insurance business will focus on resale, centered initially on the Japanese market where commissions are high. Line is also considering applications of blockchain technology in countries with underdeveloped financial infrastructure to enable services such as the such as the ability to pay utility bills via mobile phone.

The company is stepping up hiring of specialists in financial technology and blockchain around the world, according to the people. It has received hundreds of applications, they said.

Line has been offering a smartphone wallet service since 2014. Line Pay has 40 million registered users worldwide. Transaction volume jumped to 300 billion yen ($2.7 billion) last year to November, as users in Taiwan turned to the service to pay their taxes.

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