Operating and Financial Review and Prospects
Unless the context otherwise requires, all references in this section to the "Company," "we," "us," or "our" refer to Coincheck Parent and subsidiaries on after closing of the Business Combination and Coincheck prior to the closing of the Business Combination.
The following discussion of our financial condition and results of operations should be read in conjunction with the financial statements and related notes included elsewhere in this report. Our financial statements are prepared in accordance with IFRS Accounting Standards, which differ in certain significant respects from accounting principles generally accepted in other jurisdictions, including U.S. GAAP and Japanese GAAP. In addition to historical financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs that involve risks and uncertainties. Our actual results could differ materially from those discussed in the forward-looking statements as a result of many factors, including those factors in this report set forth in the sections titled "CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS" and "Item 3.D: Risk Factors," which you should review for a discussion of some of the factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis and elsewhere in this report.
Overview
We have been for several years, and believe we continue to be, a leader in the Japanese retail crypto asset industry. Now, with our recent acquisitions of 3iQ, Aplo and Next Finance, and the potential synergies they provide, our mission is to bring together retail scale, institutional capability and resilient infrastructure in one digital finance platform offering.
You should note when reading this report that our mission statement speaks to a shift in our strategy that is weighted to a non-retail business focus for meaningful growth. "Non-retail," as we view it for our business strategy, means any of the following: (a) crypto asset management (including sub-advisory) services, such as management of hedge funds and listed exchange-traded funds, and sub-advisory services to financial firms whose independent advisors are including crypto assets in portfolios being offered to their customer bases, (b) white-label or co-branded offerings or similar distribution arrangements with third-party firms who need crypto-asset trade execution and settlement, and/or custody, from a licensed crypto-asset provider so that they may offer crypto asset investments to their customer bases, which we sometimes refer to as CaaS (crypto-as-a-service) or "B2B2C" (business-to-business-to-customer) relationships, (c) crypto asset execution and settlement, and/or custody, services directly to firms or institutions as the end users, and (d) fee-generating activities, such as staking and crypto asset lending, that can be derived from our custody of customer assets.
This annual report, however, including our consolidated financial statements, is mostly focused on our performance and results for our fiscal year ended March 31, 2026, as compared to our fiscal year ended March 31, 2025 and 2024 and our financial condition as of March 31, 2026 and 2025. We owned 3iQ for only one month during this period (March 2026) and Aplo for five-and-one-half months (mid-October 2025 through March 2026). The shift in our strategy that we have described is, therefore, not meaningfully reflected in the financial periods covered by this report, other than expenses and other matters related to the acquisitions of 3iQ, Aplo and Next Finance, and our financial results from our strategy shift, assuming it has meaningful success (about which no assurances can be given), may not be reflected in our financial results for the next 12 months or longer. We ask you to read both the strategy shift we have described in our mission statement, and this historical report, in such context.
We offer our customers a multi-cryptocurrency marketplace, where we, after securing matching or offsetting orders of our customers or otherwise verifying sufficient liquidity, are the seller or buyer against our customers' executed orders. Our customers may also use our Exchange platform, which is targeted at more experienced cryptocurrency investors, where we do not act as buyer or seller, but only facilitate order books through which the buyer and seller transact directly with each other. We sometimes make purchases and sales on the Exchange platform to support liquidity for our transactions on the Marketplace platform. We generally do not charge commissions or fees for use of our Exchange platform. On both platforms, in the aggregate (excluding purchases and sales we make on the Exchange platform), we had as of March 31, 2026, according to the JVCEA, a 28.6% market share in Japan by trading volume. We also had, according to the JVCEA, 17.9% of the market share for retail users by number of verified users in Japan.
There have been a number of major crypto asset price cycles over the past decade, and price cycles continue to be volatile. Due to the highly volatile nature of crypto asset prices and trading activity, historically our operating results have fluctuated significantly from quarter to quarter in line with market sentiment and trading activity.
For the year ended March 31, 2026, our marketplace trading volume was ¥313 billion. As of March 31, 2026 our verified users in Japan were 2.5 million, our customer assets were ¥728 billion, and our assets under management were ¥128.8 billion.
Monthly KPIs
The below table shows monthly operating data1 from April 2023 through May 2026:
| April | May | June | ||||||||||||||||||
| 2023 | ||||||||||||||||||||
| (In millions, except number of verified users) | ||||||||||||||||||||
Exchange trading volume |
¥ 161,783 |
¥ 149,721 |
¥ 180,540 | |||||||||||||||||
Marketplace trading volume |
¥ 10,699 |
¥ 7,872 |
¥ 11,659 | |||||||||||||||||
Customer assets |
¥ 350,930 |
¥ 339,200 |
¥ 362,199 | |||||||||||||||||
Number of verified users | $ | 1,810,351.00 | $ | 1,820,242.00 | $ | 1,830,148.00 | ||||||||||||||
| July | August | September | October | November | December | |||||||||||||||
| 2023 | ||||||||||||||||||||
| (In millions, except number of verified users) | ||||||||||||||||||||
Exchange trading volume |
¥ 153,038 |
¥ 135,467 |
¥ 107,178 |
¥ 196,953 |
¥ 264,854 |
¥ 291,973 | ||||||||||||||
Marketplace trading volume |
¥ 14,361 |
¥ 11,060 |
¥ 9,140 |
¥ 16,365 |
¥ 18,190 |
¥ 24,101 | ||||||||||||||
Customer assets |
¥ 377,833 |
¥ 345,871 |
¥ 350,552 |
¥ 413,293 |
¥ 440,822 |
¥ 468,418 | ||||||||||||||
Number of verified users | $ | 1,844,687.00 | $ | 1,855,980.00 | $ | 1,864,765.00 | $ | 1,872,825.00 | $ | 1,884,184.00 | $ | 1,898,785.00 | ||||||||
| January | February | March | April | May | June | |||||||||||||||
| 2024 | ||||||||||||||||||||
| (In millions, except number of verified users) | ||||||||||||||||||||
Exchange trading volume |
¥ 343,495 |
¥ 368,271 |
¥ 625,318 |
¥ 463,858 |
¥ 314,753 |
¥ 271,697 | ||||||||||||||
Marketplace trading volume |
¥ 24,808 |
¥ 31,101 |
¥ 55,205 |
¥ 28,222 |
¥ 23,112 |
¥ 21,658 | ||||||||||||||
1 Exchange trading volume includes trading between matched sellers and purchasers but does not include transactions in which we are a party (including our transactions with cover counterparties). Monthly exchange trading volume data reflects trading volume by sellers and purchasers on a gross basis, and is based on information that we are required to prepare for purposes of monthly reporting to the JVCEA using the calculation methods they prescribe.
Customer assets |
¥ 476,128 |
¥ 669,686 |
¥ 744,201 |
¥ 658,149 |
¥ 736,853 |
¥ 747,891 | ||||||||||||||
Number of verified users | $ | 1,915,646.00 | $ | 1,935,987.00 | $ | 1,981,152.00 | $ | 2,014,832.00 | $ | 2,040,838.00 | $ | 2,060,379.00 | ||||||||
| July | August | September | October | November | December | |||||||||||||||
| 2024 | ||||||||||||||||||||
| (In millions, except number of verified users) | ||||||||||||||||||||
Exchange trading volume |
¥ 371,801 |
¥ 411,847 |
¥ 278,984 |
¥ 324,265 |
¥ 728,270 |
¥ 621,559 | ||||||||||||||
Marketplace trading volume |
¥ 22,724 |
¥ 18,992 |
¥ 13,412 |
¥ 18,916 |
¥ 50,404 |
¥ 48,116 | ||||||||||||||
Customer assets |
¥ 750,366 |
¥ 635,917 |
¥ 669,357 |
¥ 735,675 |
¥ 1,106,754 |
¥ 1,142,223 | ||||||||||||||
Number of verified users | $ | 2,077,756.00 | $ | 2,090,251.00 | $ | 2,100,374.00 | $ | 2,110,974.00 | $ | 2,152,448.00 | $ | 2,197,619.00 | ||||||||
| January | February | March | April | May | June | |||||||||||||||
| 2025 | ||||||||||||||||||||
| (In millions, except number of verified users) | ||||||||||||||||||||
Exchange trading volume |
¥ 595,094 |
¥ 410,135 |
¥ 454,277 |
¥ 366,050 |
¥ 375,924 |
¥ 312,516 | ||||||||||||||
Marketplace trading volume |
¥ 46,700 |
¥ 25,629 |
¥ 19,637 |
¥ 21,672 |
¥ 21,333 |
¥ 18,525 | ||||||||||||||
Customer assets |
¥ 1,285,614 |
¥ 873,795 |
¥ 859,204 |
¥ 886,884 |
¥ 989,365 |
¥ 1,000,300 | ||||||||||||||
Number of verified users | $ | 2,258,295.00 | $ | 2,278,320.00 | $ | 2,291,103.00 | $ | 2,302,376.00 | $ | 2,325,978.00 | $ | 2,351,223.00 | ||||||||
| July | August | September | October | November | December | |||||||||||||||
| 2025 | ||||||||||||||||||||
| (In millions, except number of verified users) | ||||||||||||||||||||
Exchange trading volume |
¥ 388,372 |
¥ 318,561 |
¥ 243,278 |
¥ 461,342 |
¥ 415,621 |
¥ 332,623 | ||||||||||||||
Marketplace trading volume |
¥ 39,165 |
¥ 29,146 |
¥ 26,358 |
¥ 35,996 |
¥ 29,023 |
¥ 22,651 | ||||||||||||||
Customer assets |
¥ 1,239,868 |
¥ 1,159,863 |
¥ 1,189,218 |
¥ 1,177,425 |
¥ 1,005,468 |
¥ 948,532 | ||||||||||||||
Number of verified users | $ | 2,378,672.00 | $ | 2,400,859.00 | $ | 2,421,080.00 | $ | 2,442,923.00 | $ | 2,460,621.00 | $ | 2,475,345.00 | ||||||||
| January | February | March | April | May | ||||||||||||||||
| 2026 | ||||||||||||||||||||
| (In millions, except number of verified users) | ||||||||||||||||||||
Exchange trading volume |
¥ 298,398 |
¥ 295,094 |
¥ 324,961 |
¥ 171,122 |
¥ 129,229 | |||||||||||||||
Marketplace trading volume |
¥ 25,768 |
¥ 24,143 |
¥ 18,814 |
¥ 21,603 |
¥ 16,790 | |||||||||||||||
Customer assets |
¥ 854,338 |
¥ 695,190 |
¥ 728,041 |
¥ 796,469 |
¥ 773,102 | |||||||||||||||
Number of verified users | $ | 2,498,597.00 | $ | 2,513,639.00 | $ | 2,527,772.00 | $ | 2,538,851.00 | $ | 2,547,147.00 | ||||||||||
Key Business Metrics and Trends
In addition to our financial results, we use these business metrics, and some of the components of them described below, to evaluate our business, measure our performance, identify trends affecting our business, and make strategic decisions:
Verified Users
Verified users represent users who have fully completed the account-opening application procedures, including KYC procedures, with us. Accordingly, there should only be one account per user (which we sometimes refer to as a verified account). The verified user total is adjusted for accounts that are subsequently closed, but not for those that are inactive. These numbers are for Coincheck's retail business (and exclude Aplo, 3iQ or Next Finance). Our verified users increased sequentially for all quarters primarily due, we believe, to growth in our products and services and the overall increase in interest in BTC, ETH, XRP and other crypto assets in Japan. As of
March 31, 2026, our number of verified users was approximately 2.5 million. Verified user metrics are used as a key performance indicator in our business management process because our current businesses principally serve retail users. We are able to compare our number of verified users against industry data compiled by the JVCEA to assess our competitive position. Our definition of verified users may be revised in the future if the industry data or metric used changes or there are changes in Japanese rules regarding approval of new users or accounts and how that should be defined.
Monthly Trading Users
Monthly trading users represent our verified users with at least one transaction (a purchase, sale, deposit or withdrawal) on either our Marketplace or Exchange platform in the prior calendar month. We view them as the active users on our cryptocurrency exchanges. Monthly trading users drive retail trading volume, and growth in our monthly trading users has historically been correlated with both the price of BTC, ETH, XRP and other crypto assets and volatility within the crypto asset market. We have aimed to expand our revenue opportunities by, in recent years, adding new cryptocurrencies to give more investment options and by marketing cryptocurrency trading to retail investors.
Customer Assets (by Currency)
Customer assets consist of cryptocurrencies held for customers and fiat currency deposited by customers. Cryptocurrencies held for customers are a measure of the scale of total value held on our cryptocurrency exchanges as of the period indicated. We believe that customer assets reflect the trusted nature of our cryptocurrency exchanges and services. The value of our customer assets is driven by the price, quantity, and type of crypto assets held by customers. Customer assets include cash deposited by customers, which is segregated in a trust account with a trust bank, and customers' crypto assets that we hold in custody. Because the amount and value of our customer assets are driven by multiple factors, some of which are market dependent, this metric has fluctuated in recent periods.
Trading Volume (by Cryptocurrency)
The trading volume of our Marketplace platform customers is directly correlated with our revenue and is influenced by both price and volatility of BTC, ETH, XRP and other crypto assets. We have experienced periods of low and high trading volume, and therefore revenue, driven by periods of rising or declining crypto asset prices and/or lower or higher volatility within the crypto asset market. During periods of rising BTC prices and higher volatility, we have generally observed higher trading volume on both our Marketplace platform and Exchange platform. There are a number of factors that contribute to changes in price and volatility of a given crypto asset, including, but not limited to: changes in the supply and demand for a particular crypto asset; crypto market sentiment; macroeconomic factors; utility of a particular crypto asset; and other events, such as exchange outages or social media commentary. Market participation by well-known investors can also affect consumer sentiment.
The following table shows the trading volume by currency on our Marketplace platform for the fiscal years ended March 31, 2026, 2025 and 2024:
| For the fiscal year ended March 31, | |||||||||||
| 2026 | 2025 | 2024 | |||||||||
| (In millions) | |||||||||||
BTC |
¥ 121,199 | $ | 143,717.00 | ¥ 106,976 | |||||||
ETH | $ | 130,325.00 | $ | 78,468.00 | $ | 63,711.00 | |||||
XRP | $ | 34,767.00 | $ | 55,644.00 | $ | 20,729.00 | |||||
IOST | 530 | $ | 3,016.00 | $ | 5,450.00 | ||||||
ENJ | 73 | 352 | $ | 1,642.00 | |||||||
LTC | $ | 1,385.00 | $ | 2,642.00 | $ | 2,529.00 | |||||
SAND | 469 | $ | 2,247.00 | $ | 2,056.00 | ||||||
XLM | $ | 2,705.00 | $ | 5,539.00 | $ | 1,545.00 | |||||
BCH | $ | 3,459.00 | $ | 4,782.00 | $ | 3,624.00 | |||||
BAT | 418 | 541 | 571 | ||||||||
DOT | 399 | $ | 1,473.00 | $ | 1,338.00 | ||||||
QTUM | 303 | 733 | 560 | ||||||||
MONA | 102 | 435 | 509 | ||||||||
LSK | 234 | 174 | 484 | ||||||||
SHIB | $ | 2,966.00 | $ | 16,286.00 | $ | 12,025.00 | |||||
Others | $ | 13,268.00 | $ | 21,478.00 | $ | 10,816.00 | |||||
Total |
¥ 312,599 |
¥ 337,527 |
¥ 234,566 | ||||||||
Assets Under Management
Through our acquisition of 3iQ, which became effective on March 1, 2026, we entered the asset management business. Assets under management (AUM) is the principal driver of investment management fee revenue. As of March 31, 2026, 3iQ's AUM was ¥128.8 billion. For the year ended March 31, 2026, investment management fee revenue from 3iQ was ¥139 million, but this reflects only one month of our post-acquisition ownership.
IEO Revenue
We launched our IEO platform, Coincheck IEO, in July 2021, which was the first of its kind in Japan, and on which the first approved IEO in Japan was launched later that year. We charge fees to companies seeking to list on our exchange using our IEO platform, including a certain proportion of the tokens to be sold on the exchange. Commissions received from the issuer and customers, which are based on the fair value of the tokens at the time received, were ¥359 million, ¥397 million and ¥nil million, for the years ended March 31, 2026, 2025 and 2024, respectively. IEO-related commissions are recorded by us as commissions received.
Factors Affecting Our Results of Operations
The success and historical growth of our business as well as our financial condition and operating results have been and will continue to be affected by a number of factors, as described in more detail below.
Price and volatility of crypto assets
For the years ended March 31, 2026 and 2025, 94.9% and 99.6%, respectively, of our total revenue consisted of transaction revenue generated from trades with customers and cover counterparties on our Marketplace platform business. As a result, our total revenue is highly correlated with the price and volatility of crypto assets. As earlier mentioned, there are a number of factors that contribute to changes in crypto asset prices and volatility, including, but not limited to: changes in the supply and demand for a particular crypto asset; overall crypto market sentiment; macroeconomic factors; the utility of a particular crypto asset; and other events, such as exchange outages, social media commentary, and government policies.
Adoption of crypto assets and offering of new crypto assets
Our financial performance has been dependent on the continued growth in interest for, and adoption of, crypto assets by retail investors in Japan. The number of crypto assets that are tradeable on our cryptocurrency exchanges has increased over time, and we offered 33 different crypto assets on our Marketplace platform as of March 31, 2026. Over time, we have observed an overall positive trend in the total market capitalization of crypto assets, which indicates increased adoption. However, these historical trends are not indicative of future adoption, and it is possible that the adoption of crypto assets and blockchain technology may slow, decline, take longer to develop, or never be as broadly adopted as many anticipate, which would negatively impact our business and operating results.
Ability to competitively price our products and services
Our operating results for our retail business in Japan also depend on our ability to competitively price our products and services. Similar to other financial products, as the crypto asset industry matures we anticipate increased pressure on spreads and commission fees to emerge over time as new, and potentially larger and more established, financial institutions enter the market.
While we believe that we will be able to maintain our position as a trusted brand in Japan and continue to enhance our customer-value proposition and grow our scale, including growing our customer base, in order to offset the effects of any future price pressure on our fees, if we are unable to do so or if such price pressure emerges more rapidly than we anticipate our operating results may be adversely affected.
Marketing for our Marketplace platform in Japan
Our primary means of marketing our Marketplace platform in Japan has been digital marketing, which allows us to respond flexibly to the impact of changes in the market price of crypto assets. We use television advertisements only to the extent we believe those investments can produce a reasonable return within a reasonable period of time based on our estimated conversion ratio and other factors. Generally, we estimate our return of investment per marketing campaign, which is a primary factor in our decision as to whether launch the campaign.
We monitor our total marketing costs for customer acquisition (MCC), cost per acquisition (CPA) and customer payback to assess the effectiveness of our marketing. Relevant measures for recent periods are summarized below:
Revenue and Total MCC (Marketplace platform)
Source: Coincheck Internal data.
____________
(1) The table above provides our total MCC, CPA, and customer payback for the periods from April 2023 to March 2026. The left bar for each quarter details our total marketing costs, whereas the right bar for each quarter details our customer payback amount for 24 months, including the month in which each customer completed the KYC process (and if 24 months have not passed, from the month in which each customer completed the KYC process to the end of March 2025), for the cohort of customers that were acquired within the quarter. The line above each set of bars provides our CPA for each given quarter. This number is derived by taking the MCC in a given period and dividing it by the total incremental customers that completed our KYC process in that respective quarter.
(2) MCC and revenue in the table above also include items that are recognized as deductions from sales for accounting purposes.
(3) For example, for the three months ended March 2024, our MCC totaled ¥261 million, representing a CPA of approximately ¥3,168. Customers acquired during this period subsequently generated cumulative net revenue of ¥1,529 million over the following 24 months. In the chart, the left bar for each quarter reflects the fixed MCC incurred during that period. The right bar represents the cumulative revenue generated by the corresponding customer cohort, measured over a 24-month period following acquisition (or through March 2026 for cohorts that have not yet reached 24 months). The stacked segments within each revenue bar illustrate the timing of revenue realization: gray (months 1-3), light blue (months 4-6), purple (months 7-9), and light green (months 10-24.
The markets for crypto assets continue to evolve, and the number of new accounts opened in a certain period is heavily influenced by a variety of external factors, including price trends of the cryptocurrencies supported on our cryptocurrency exchanges and media coverage regarding crypto asset markets. Because of the volatility in markets for crypto assets and the highly variable nature of our advertising and promotion expenses, these historical metrics may be of limited value in predicting future performance for our Marketplace platform. We expect to continue to consider the latest market trends, our financial condition and other factors, in addition to historical experience of marketing effectiveness in any given period, in determining appropriate levels of marketing expenditures. In addition, we plan to continue to invest in the development of and market new products and services.
Regulation in Japan
Our financial prospects and continued growth in Japan depend in part on our ability to continue to operate in a manner compliant with applicable regulations. Our business is subject to the oversight of numerous regulatory and self-regulatory agencies in Japan, including, but not limited to, JFSA and the JVCEA. We received our license as a crypto asset exchange service provider from the JFSA in January 2019.
Our strategy is to continue to invest in our finance, legal, compliance, and security functions in order to remain at the forefront of crypto policy initiatives and regulatory trends in Japan and maintain our reputation and trust with customers and regulators. As the industry matures, we may experience fluctuations in our operating results as a result of changes in the law and regulations that are applicable to our business, which may limit our ability to support new blockchains and crypto assets and offer our products and services.
Additionally, as a company with its shares registered with SEC and listed on Nasdaq, we are subject to certain reporting and regulatory requirements in the United States. In the United States, on January 21, 2025, the SEC announced the formation of the Crypto Task Force, chaired by SEC Commissioner Hester Peirce. Also in January 2025, the SEC released SAB No. 122, rescinding SAB No. 121, Accounting for Obligations to Safeguard Crypto-Assets an Entity Holds for Platform Users, which, until repealed, required an entity to record a liability to reflect its obligation to safeguard the crypto assets held for its platform users with a corresponding asset and required disclosures related to the entity's safeguarding obligations. SAB No. 122 is effective for annual periods beginning after December 15, 2024, and is required to be applied on a fully retrospective basis, with early adoption permitted. The Company early adopted SAB No. 122 in the fiscal year ended March 31, 2025 and therefore does not recognize the safeguard liabilities and corresponding safeguard assets in its consolidated statement of financial position.
See, also, "Business Overview - Regulatory Environment."
Components of Results of Operations
Total revenue
Total revenue is generated from several distinct sources. The primary components include transaction revenue at Marketplace platform business and transaction revenue from Aplo's prime brokerage services, staking revenue, commission received, investment management fee revenue (for the one month we owned 3iQ in the fiscal year ended March 31, 2026), and other revenue. We offered 33 different types of cryptocurrencies at our Marketplace platform as of March 31, 2026, including BTC, ETH, XRP and other altcoins (altcoins have been an industry term for cryptocurrencies other than BTC). Our revenue is susceptible to significant fluctuations as trading volumes depend on cryptocurrency market volatility and prices, which ultimately impact how much revenue we earn. Additionally, if a type of cryptocurrency is purchased and settled by another type of cryptocurrency in a cover transaction, the settlement is treated as a sale transaction under IFRS 15 Revenue from Contracts with Customers. Consequently, the accounting treatment of this type of cover transactions results in higher reported gross revenue relative to the underlying customer transaction volume.
Transaction revenue
Transaction revenue from our Marketplace platform business is derived from transactions with customers and cover counterparties. The table below shows this breakdown of transaction revenue for the fiscal years indicated:
| For the fiscal year ended March 31, | |||||||||||
| 2026 | 2025 | 2024 | |||||||||
Marketplace platform business | |||||||||||
Transaction revenue from customers |
¥ 239,195 |
¥ 243,696 |
¥ 158,733 | ||||||||
Transaction revenue from cover counterparties | $ | 216,772.00 | $ | 138,009.00 | $ | 64,313.00 | |||||
Transaction revenue - Institutional | $ | 19,867.00 | $ | - | $ | - | |||||
Transaction revenue (total) |
¥ 475,834 |
¥ 381,705 |
¥ 223,046 | ||||||||
Transaction revenue is recognized at the time the transaction is processed. We have experienced periods of low and high-trading volume, and therefore transaction revenue, driven primarily by periods of rising or declining BTC prices and/or lower or higher-cryptocurrency volatility. During periods of rising BTC prices and higher volatility, we have generally observed higher transaction revenue generated by our Marketplace platform business.
Average spread
For customer purchase and sale transactions on our Marketplace platform, Coincheck is always the seller to, and buyer from, the customer, and its compensation is in the form of a price spread. The spread we set is generally in a range of 0.1% to 5.0% of the transaction's asset value, and can change from time to time. For the fiscal year ended March 31, 2026, 2025 and 2024, our average spread (our fee) per transaction for our Marketplace platform business was 3.28%, 3.49% and 3.45%, respectively. The changes in average spreads are due primarily to the change in the mix of cryptocurrencies being traded.
Commission received
Our commissions received have consisted primarily of remittance fees, deposit and withdrawal and transfer fees, custodial fees, commissions received from the issuer and subscribing customers in the IEO business, commissions that arise from transactions on the Coincheck NFT Marketplace, commissions that arise from transactions on our Exchange platform, and other commissions.
Investment management fee revenue
Investment management fee revenue consists of fees earned by 3iQ for providing asset management and sub-advisory services to the funds and accounts it manages. These fees are generally calculated as a contractual percentage of assets under management and are recognized over the period during which the services are provided. Because we acquired 3iQ, which became effective on March 1, 2026, our consolidated results include investment management fee revenue only from March 1, 2026.
Expenses
Expenses consist of cost of sales and selling, general, and administrative expenses.
Cost of sales
Our cost of sales mainly consists of crypto assets once acquired from customers or cover counterparties on the Marketplace platform or Exchange platform and from institutional customers and cover counterparties, and staking reward remittance to customers.
Selling, general, and administrative expenses
Personnel expenses and advertising and promotion expenses are the largest components of our selling, general, and administrative expenses. Our personnel expenses are expected to scale if and as our revenues grow. In addition, systems-related expenses are correlated with user numbers and trading volumes and incurred in order to support our mobile and desktop web applications and trading operation system.
Our other costs are relatively fixed in nature, which we believe allows us to target significant operating leverage through growth of our customer base. We believe that our expense structure enables us to be profitable, or minimize loss, even in periods with low trading volume.
Selling, general, and administrative expenses consist primarily of the following:
•Personnel expenses. Personnel expenses consist of salaries and bonuses of our employees and share-based compensation for restricted share units. Share-based compensation were granted to managing directors and officers, board members and other qualified employees and non-employee consultants..
•Advertising and promotion expenses. Advertising and promotion expenses primarily include expenses incurred for the advertising of our products in various media, including television, internet (including social media and online video-sharing platforms) and affiliate marketing programs.
•Professional fees. Professional fees consist of legal, accounting and other consulting fees. Professional fees includes transaction expenses related to Company business acquisitions.
•Communication expenses. Communication expenses include cloud service expenses such as Amazon Web Services.
•Subcontract expenses. Subcontract expenses include outsourcing costs.
Selling, general, and administrative expenses also include depreciation and amortization, business management service fees, transaction related costs, subcontract labor costs, tax expenses, and other expenses.
Other Income and Expenses
Other income
Other income is revenue that is separate from the core operations of our business, such as exchange gain or other amounts outside of our primary business activities.
Other expenses
Other expenses consist primarily of exchange loss and disposals of intangible assets.
Financial Income and Expenses
Financial income
Financial income consists primarily of change in fair value of warrant liabilities.
Financial expenses
Financial expenses consist primarily of interest expenses and change in fair value of warrant liability.
Historical Results of Operations
Comparison of the year ended March 31, 2026, with the year ended March 31, 2025
The following table shows selected consolidated statements of profit or loss data for the years ended March 31, 2026 and 2025:
| For the fiscal year ended March 31, | ||||||||
| (In millions) | 2026 | 2025 | ||||||
| Revenue: | ||||||||
| Revenue | ¥ 477,179 |
¥ 383,205 | ||||||
| Other revenue | $ | 3,065.00 | 125 | |||||
| Total revenue | $ | 480,244.00 | $ | 383,330.00 | ||||
| Expenses: | ||||||||
| Cost of sales | $ | 467,173.00 | $ | 369,852.00 | ||||
| Selling, general and administrative expenses | $ | 14,492.00 | $ | 14,458.00 | ||||
| Total expenses | $ | 481,665.00 | $ | 384,310.00 | ||||
| Operating loss | $ | (1,421.00) | $ | (980.00) | ||||
| Other income and expenses | ||||||||
| Other income | 660 | 22 | ||||||
| Other expenses | $ | (236.00) | $ | (105.00) | ||||
| Financial income | 318 | $ | 1,457.00 | |||||
| Financial expenses | $ | (178.00) | $ | (39.00) | ||||
| Share of loss of equity-accounted investees, net of tax | $ | (18.00) | $ | - | ||||
| Listing expense | $ | - | $ | (13,714.00) | ||||
| Loss before income taxes | $ | (875.00) | $ | (13,359.00) | ||||
| Income tax expense | 958 | 991 | ||||||
| Net loss for the year | $ | (1,833.00) | $ | (14,350.00) | ||||
Revenue. Revenue was ¥477,179 million in the year ended March 31, 2026, an increase of ¥93,973 million, or 25%, from ¥383,205 million in the year ended March 31, 2025. The increase was due mainly to increases in transaction revenue--institutional and revenue from cover counterparty transactions.
Other revenue. Other revenue was ¥3,065 million in the year ended March 31, 2026, an increase of ¥2,941 million, or 2361%, from ¥125 million in the year ended March 31, 2025. The increase was due mainly to staking revenue of ¥2,574 million and investment management fee revenue of ¥139 million.
Cost of sales. Cost of sales was ¥467,173 million in the year ended March 31, 2026, an increase of ¥97,321 million, or 26%, from ¥369,852 million in the year ended March 31, 2025. This increase was due mainly to increases in transaction revenue--institutional and revenue from cover counterparty transactions and staking reward remittances to customers.
Selling, general, and administrative expenses. Selling, general, and administrative expenses were ¥14,492 million in the year ended March 31, 2026, an increase of ¥34 million, or 0.2%, relatively flat, from ¥14,458 million in the year ended March 31, 2025. The relatively flat year-over-year result reflects significant offsetting movements. Increases in expenses were due primarily to (i) share-based compensation of ¥1,320 million pursuant to restricted share units (RSUs) issued pursuant to our Omnibus Incentive Plan (April 1, 2026 were the first issuances under that plan), (ii) higher operating costs from increased headcount and business expansion, including the addition of employees and operations from the 3iQ, Aplo, and Next Finance acquisitions, and (iii) higher professional fees as a listed company and related to the acquisitions. However, these increases were offset by the non-recurrence of ¥4,607 million of professional fees related to the Company's de-SPAC business combination incurred in the year ended March 31, 2025, as well as a reduction of ¥397 million in management fees payable to Monex following Coincheck Parent completing the Business Combination and being listed on Nasdaq in December 2024.
The following table shows. selling, general and administrative expenses for the years ended March 31, 2026 and 2025 consist of the followings:
| For the fiscal year ended March 31, | ||||||||
| (Unit： In millions) | 2026 | 2025 | ||||||
| Personnel expenses | ¥ 5,121 |
¥ 2,684 | ||||||
| Advertising and promotion expenses | $ | 1,588.00 | $ | 1,874.00 | ||||
| Professional fees | $ | 2,632.00 | $ | 6,163.00 | ||||
| Communication expenses | $ | 1,282.00 | 786 | |||||
| Subcontract expenses | $ | 1,401.00 | 857 | |||||
| Depreciation and amortization | 773 | 727 | ||||||
| Business management fee | $ | - | 397 | |||||
| Transaction related costs | 334 | 423 | ||||||
| Subcontract labor costs | 223 | 142 | ||||||
| Tax expenses | 426 | 100 | ||||||
| Others | 712 | 305 | ||||||
| Total | ¥ 14,492 |
¥ 14,458 | ||||||
Operating loss. Operating loss was ¥1,421 million in the year ended March 31, 2026, compared to operating loss of ¥980 million in the year ended March 31, 2025, an increase in operating loss of ¥441 million. The increase in operating loss was caused primarily by an increase in cost of sales, partially offset by an increase in total revenue.
Other income. Other income was ¥660 million in the year ended March 31, 2026, an increase of ¥638 million, from ¥22 million in the year ended March 31, 2025. The increase related to other income of ¥239 million from the collection of NEM previously stolen from Coincheck's hot wallets; these assets had been seized by the public prosecutor and were returned pursuant to "Japan's Act on the Payment of Compensation for Criminal Damage Using Stolen and Misappropriated Property."
Other expenses. Other expenses were ¥236 million in the year ended March 31, 2026, an increase of ¥131 million, from ¥105 million in the year ended March 31, 2025. The increase relates primarily to capitalized software
impairment cost of ¥197 million connected to a Coincheck development project that occurred during the year ended March 31, 2026.
Financial income. Financial income was ¥318 million in the year ended March 31, 2026, a decrease of ¥1,139 million, from ¥1,457 million in the year ended March 31, 2025. The decrease was due primarily to a lower fair value gain of the Company's warrant liability of ¥312 million in the year ended March 31, 2026 compared to ¥1,435 million in the year ended March 31, 2025.
Financial expenses. Financial expenses were ¥178 million in the year ended March 31, 2026, an increase of ¥138 million, from ¥39 million in the year ended March 31, 2025. The increase was due primarily to higher interest expense of ¥161 million in the year ended March 31, 2026, compared to ¥29 million in the year ended March 31, 2025.
Listing expense. Listing expense was ¥13,714 million in the year ended March 31, 2025. The listing expense relates to the completion of the Business Combination and listing of our Ordinary Shares on Nasdaq in December 2024. The listing expense represents the excess of fair value of Coincheck Parent's shares deemed to have been issued over the fair value of Thunder Bridge's identifiable net assets acquired, and represents compensation for the service of a stock exchange listing for its shares that was expensed as incurred.
Income tax expenses. Income tax expenses were ¥958 million in the year ended March 31, 2026, a decrease of ¥33 million from ¥991 million in the year ended March 31, 2025. Despite a consolidated pre-tax loss, income tax expense remained significant as Coincheck continued to generate taxable income on a standalone basis.
Comparison of the year ended March 31, 2025, with the year ended March 31, 2024
The following table shows selected consolidated statements of profit or loss data for the years ended March 31, 2025 and 2024:
| For the fiscal year ended March 31, | ||||||||
| (In millions) | 2025 | 2024 | ||||||
| Revenue: | ||||||||
| Revenue | ¥ 383,205 |
¥ 223,775 | ||||||
| Other revenue | 125 | 274 | ||||||
| Total revenue | $ | 383,330.00 | $ | 224,049.00 | ||||
| Expenses: | ||||||||
| Cost of sales | $ | 369,852.00 | $ | 214,786.00 | ||||
| Selling, general and administrative expenses | $ | 14,458.00 | $ | 6,757.00 | ||||
| Total expenses | $ | 384,310.00 | $ | 221,543.00 | ||||
| Operating profit (loss) | $ | (980.00) | $ | 2,506.00 | ||||
| Other income and expenses | ||||||||
| Other income | 22 | 437 | ||||||
| Other expenses | $ | (105.00) | $ | (153.00) | ||||
| Financial income | $ | 1,457.00 | 67 | |||||
| Financial expenses | $ | (39.00) | $ | (17.00) | ||||
| Listing expense | $ | (13,714.00) | $ | - | ||||
| Profit (loss) before income taxes | $ | (13,359.00) | $ | 2,840.00 | ||||
| Income tax expense | 991 | 873 | ||||||
| Net profit (loss) for the year | $ | (14,350.00) | $ | 1,967.00 | ||||
Revenue. Revenue was ¥383,205 million in the year ended March 31, 2025, an increase of ¥159,430 million, or 71%, from ¥223,775 million in the year ended March 31, 2024. The increase was due mainly to increased transaction revenue due to the increased Marketplace platform trading volume.
Other revenue. Other revenue was ¥125 million in the year ended March 31, 2025, a decrease of ¥149 million, or 54%, from ¥274 million in the year ended March 31, 2024. The decrease was due mainly to decreased sales of NFTs.
Cost of sales. Cost of sales was ¥369,852 million in the year ended March 31, 2025, an increase of ¥155,065 million, or 72%, from ¥214,786 million in the year ended March 31, 2024. This increase was due mainly to an increase in trading volume on our Marketplace platform.
Selling, general, and administrative expenses. Selling, general, and administrative expenses were ¥14,458 million in the year ended March 31, 2025, an increase of ¥7,701 million, or 114%, from ¥6,757 million in the year ended March 31, 2024. The increase was due mainly to an increase in professional fees relating to the Business Combination and listing of the Company's Ordinary Shares on Nasdaq.
| For the fiscal year ended March 31, | ||||||||
| (In millions) | 2025 | 2024 | ||||||
| Personnel expenses | ¥ 2,684 |
¥ 2,287 | ||||||
| Advertising and promotion expenses | $ | 1,874.00 | 661 | |||||
| Professional fees | $ | 6,163.00 | 710 | |||||
| Communication expenses | 786 | 769 | ||||||
| Subcontract expenses | 857 | 473 | ||||||
| Depreciation and amortization | 727 | 679 | ||||||
| Business management fee | 397 | 458 | ||||||
| Transaction related costs | 423 | 335 | ||||||
| Subcontract labor costs | 142 | 130 | ||||||
| Tax expenses | 100 | 116 | ||||||
| Others | 305 | 139 | ||||||
| Total | ¥ 14,458 |
¥ 6,757 | ||||||
Operating profit (loss). Operating loss was ¥980 million in the year ended March 31, 2025, a decrease of ¥3,486 million, or 139%, from an operating profit of ¥2,506 million in the year ended March 31, 2024. A large component of the operating loss in the year ended March 31, 2025 was total professional expenses of ¥4,607 million related to the Business Combination and listing of the Company's Ordinary Shares on Nasdaq.
Other income. Other income was ¥22 million in the year ended March 31, 2025, a decrease of ¥415 million, or 95%, from ¥437 million in the year ended March 31, 2024, which included a gain of ¥300 million from the sale of a business. We decided to sell this business because it was not related to the crypto assets industry.
Other expenses. Other expenses were ¥105 million in the year ended March 31, 2025, a decrease of ¥48 million, or 31%, from ¥153 million in the year ended March 31, 2024. The decrease primarily related to a cancellation penalty in a lease contract of ¥44 million that occurred in the year ended March 31, 2024.
Financial income. Financial income was ¥1,457 million in the year ended March 31, 2025, an increase of ¥1,390 million, from ¥67 million in the year ended March 31, 2024. The change was due mainly to the decrease in the fair value of our warrant liabilities.
Listing expense. Listing expense was ¥13,714 million in the year ended March 31, 2025 (there was no listing expense in the prior year). The listing expense relates to the completion of the Business Combination and listing of our Ordinary Shares on Nasdaq in December 2024. The listing expense represents the excess of fair value of Coincheck Parent shares deemed to have been issued over the fair value of Thunder Bridge's identifiable net assets acquired, and represents compensation for the service of a stock exchange listing for Coincheck Parent shares that is expensed as incurred.
Financial expenses. Financial expenses were ¥39 million in the year ended March 31, 2025, an increase of ¥22 million, or 129%, from ¥17 million in the year ended March 31, 2024. The change was due mainly to an increase in interest expenses.
Income tax expenses. Income tax expenses were ¥991 million in the year ended March 31, 2025, an increase of ¥118 million, or 14%, from ¥873 million in the year ended March 31, 2024. The increase in income tax expenses was due mainly to increased taxable income.
Liquidity and Capital Resources
We finance our operations primarily with our cash flows from operating activities. Our fundamental principles are to build and maintain a financial base for the purpose of maintaining soundness and efficiency of operations and achieving sustainable growth. According to these principles, we plan on conducting capital investment, profit distribution, and repayment of any loans based on our operating cash flows through the development and rendering of our crypto asset exchange services.
Cash and cash equivalents mainly consist of bank deposits. As of March 31, 2026, we had cash and cash equivalents of ¥9,458 million2. As of March 31, 2025, we also had cash segregated as deposits of ¥50,024 million. In accordance with Japanese laws and regulations, 100% of the legal tender deposited by customers is protected by trust companies. Therefore, cash deposited by customers is accounted for under different accounts depending on whether it is protected by trust companies or not. Additionally, Coincheck entered into a line of credit with our affiliate, Monex Finance Corporation, with aggregate commitments as of March 31, 2026, and 2025 of ¥5,000 and ¥6,000 million, respectively. During the year ended March 31, 2026, the commitment line with Monex Finance Corporation was utilized on a short-term revolving basis for liquidity management purposes, with amounts periodically drawn and repaid throughout the year. No amounts were outstanding under this arrangement as of March 31, 2026 or 2025. On September 1, 2025, Coincheck entered into a ¥500 million subordinated loan with Monex Finance Corporation. Coincheck Parent entered into its own commitment line contract of ¥2,554 million as a debtor with Monex Finance Corporation in December 2024, for the purpose of stable operating capital. As of March 31, 2026, the balance outstanding under this was ¥2,024 million.
In addition, Coincheck entered into a committed credit line for ¥200 million with JSF Trust and Banking Co., Ltd. in June 2021, which was increased to ¥500 million and ¥1,000 million as of March 31, 2025 and 2026, respectively, and has been making short-term borrowings under this agreement several times a year, however, all of the borrowings were repaid within about a week of the making of each respective loan and the credit line was unused as of March 31, 2026. In addition, Coincheck entered into a committed credit line for ¥2,000 million with Aozora Bank, Ltd. as of March 31, 2026. We believe our existing cash and cash equivalents, together with our loan arrangements, are sufficient to meet our immediate working capital and capital expenditure needs.
We hold crypto assets on our consolidated statements of financial position principally to facilitate customer transactions. Because most customer crypto assets are held in segregated cold wallets and are not accessible for settlement purposes, we hold crypto assets in our own wallets (nearly all of which are crypto assets borrowed from customers under our Coincheck Lending program) to facilitate prompt settlement of transactions. As of March 31, 2026, we had ¥37,876 million of crypto assets held (current assets). These cryptocurrencies are held and treated as inventories that are recorded at fair value as of the end of the reporting period. The fair value is measured by using a midmarket pricing of the principal market or the most advantageous market. As of March 31, 2026, crypto asset borrowings under our Coincheck Lending program totaled ¥37,543 million. We determine the amount of crypto assets to hold based on the total size of our customer assets and recent trading levels. Our finance department is responsible for monitoring and determining the appropriate amount, and our treasury department is then responsible for managing what amount of crypto assets to hold in hot wallets and to deposit with cover counterparties in accordance with our internal policies. In the interest of security, our policy is to hold the majority of borrowed
2
customer crypto assets in cold wallets and to hold in hot wallets only the amount of crypto assets we deem necessary for expected settlement transactions with cover counterparties and external transfer requests.
The following table shows the amounts held by crypto asset, as well as in hot wallets and cold wallets, or deposited with cover counterparties, as of March 31, 2026, 2025 and 2024.
As of March 31, | |||||||||||
| 2026 | 2025 | 2024 | |||||||||
(in millions of yen) | |||||||||||
BTC |
¥ 28,554 |
¥ 33,690 |
¥ 32,595 | ||||||||
ETH | $ | 2,659.00 | $ | 2,127.00 | $ | 6,198.00 | |||||
XRP | $ | 5,806.00 | $ | 7,673.00 | $ | 2,892.00 | |||||
IOST | 29 | 112 | 413 | ||||||||
ENJ | $ | - | 17 | 130 | |||||||
XEM | $ | - | 18 | 99 | |||||||
XLM | 123 | 179 | 106 | ||||||||
BCH | 303 | 185 | 406 | ||||||||
LTC | 106 | 144 | 189 | ||||||||
LSK | 3 | 24 | 117 | ||||||||
BAT | $ | - | 23 | 73 | |||||||
QTUM | $ | - | 30 | 95 | |||||||
MONA | 6 | 17 | 30 | ||||||||
Others | 285 | 442 | 864 | ||||||||
Total crypto assets held (current assets) |
¥ 37,876 |
¥ 44,680 |
¥ 44,207 | ||||||||
Amount held in cold wallets |
¥ 36,148 |
¥ 41,346 |
¥ 39,749 | ||||||||
Amount held in hot wallets |
¥ 1,609 |
¥ 2,965 |
¥ 3,641 | ||||||||
Amount deposited with counterparties |
¥ 119 |
¥ 370 |
¥ 817 | ||||||||
The following table shows the amount of borrowed crypto assets, by crypto asset, as of March 31, 2026, 2025, and 2024:
As of March 31, | |||||||||||
| 2026 | 2025 | 2024 | |||||||||
(in millions of yen) | |||||||||||
BTC |
¥ 28,534 |
¥ 33,651 |
¥ 32,585 | ||||||||
ETH | $ | 2,433.00 | $ | 2,066.00 | $ | 6,187.00 | |||||
XRP | $ | 5,804.00 | $ | 7,672.00 | $ | 2,888.00 | |||||
IOST | 28 | 110 | 412 | ||||||||
ENJ | $ | - | 16 | 129 | |||||||
XEM | $ | - | 17 | 96 | |||||||
XLM | 122 | 181 | 105 | ||||||||
BCH | 301 | 184 | 405 | ||||||||
ETC | 42 | 79 | 166 | ||||||||
LTC | 2 | 24 | 118 | ||||||||
LSK | 106 | 143 | 184 | ||||||||
BAT | $ | - | 24 | 72 | |||||||
QTUM | $ | - | 31 | 94 | |||||||
MONA | 6 | 17 | 30 | ||||||||
Others | 164 | 265 | 549 | ||||||||
Total borrowed crypto assets |
¥ 37,543 |
¥ 44,479 |
¥ 44,020 | ||||||||
We monitor the risk related to crypto assets held in hot wallets or deposited with cover counterparties closely, and our policy is to restrict such amounts to the level necessary to support our operations. As of March 31, 2026, our crypto assets held (current assets) were ¥37,876 million, of which crypto assets borrowed from customers accounted for ¥37,543 million. As of March 31, 2026, the aggregate of crypto assets held in hot wallets and crypto assets deposited with our cover counterparties was ¥1,728 million, as compared to our cash and cash equivalents of ¥9,458 million.
Borrowing cryptocurrencies from our customers enables us to facilitate trading on our Marketplace platform at a lower cost than procuring the cryptocurrencies from alternate sources. The terms of the borrowing arrangements also limit our exposure to the price risk of the underlying crypto assets because we return such crypto assets in kind at the end of the borrowing period. Both our crypto assets held in current assets and our crypto asset borrowings are reported at fair value so the impact of price changes in the underlying crypto assets are offset. We utilize borrowed crypto assets to facilitate the prompt execution of customer transactions and cover transactions at external exchanges. We do not use borrowed crypto assets for proprietary trading or to enter into unhedged positions. We have not experienced difficulties in borrowing crypto assets from our customers or in executing cover transactions with our cover counterparties in order to support the operation of our Marketplace platform. Nevertheless, in the event that borrowing from our customers becomes limited or unavailable, we would seek to secure the crypto assets necessary to facilitate the operation of our Marketplace platform by borrowing from third parties. However, there is no guarantee that we would be able to find third parties to borrow the needed amount of crypto assets, in which case we would seek to purchase such crypto assets in the market, exposing us to price risk. In our Marketplace platform trading operations, we seek to limit our net open position at any given time by setting internal policy threshold amounts for each cryptocurrency supported and executing cover transactions when the relevant threshold is reached.
We have not invested in cryptocurrencies for our own account (apart from inventory we acquire to support liquidity for transactions), but we may do so in the future.
Under IFRS Accounting Standards, there are no accounting standards specifically related to transactions for crypto assets. In order to determine the accounting treatment, we follow the requirements of IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, and refer to the conceptual framework for financial reporting, and standards related to similar matters. In this context, we consider various factors to evaluate whether we have control for accounting purposes over crypto assets, and account for these transactions accordingly. See Note 13 to our consolidated financial statements for the year ended March 31, 2026 included in this report for more information on our accounting treatment for crypto assets held.
Under the Payment Services Act, we are defined as a Crypto Asset Exchange Service Provider (CAESP) and are subject to certain regulations regarding the management of the crypto assets of our customers. For example, we must segregate all fiat currency and cryptocurrencies of our customers from our own property, keep cryptocurrencies we own in separate wallets, and keep at least 95% of our customers' cryptocurrencies in wallets that are not connected to the internet, or "cold wallets." For more information on the regulations applicable to our business and our holdings of crypto assets, see "Business - Regulation." Accordingly, we have separate wallets for our owned cryptocurrencies and those deposited by our customers, and manage them separately.
Because we safeguard customers' cryptocurrencies in accordance with the requirements of the Payment Services Act, the Cabinet Office Ordinance on Virtual Currency Exchange Service Providers, and other applicable laws and regulations, we estimate that the possibility of potential loss events is remote. Therefore, we determined that there are no loss contingencies related to an obligation to safeguard customer crypto assets from loss or theft as of March 31, 2026. See Note 31 to our consolidated financial statements as of and for the year ended March 31, 2026 included in this report.
Airdrops and forks are events that are unique to cryptocurrency businesses, including ours. As these events occur independently of our decision-making process, it is challenging for us to comprehensively understand and value each specific airdrop or fork. We have limited ability to predict whether the sale of cryptocurrencies received from airdrops or forks will be material to our future earnings, which is dependent on the future market viability and fair value of such cryptocurrencies. On the other hand, for airdrops and forks that may have a significant impact, we consider granting such crypto assets to our customers depending on the volume of cryptocurrencies deposited with us. When considering whether or not to grant such cryptocurrencies to customers, we first confirm that the cryptocurrencies can be transferred securely, and after such confirmation we recognize the granted cryptocurrencies based on the market price of such asset. Under our current policy, we do not monetize any cryptocurrencies granted through airdrops and forks that have not yet been granted to customers.
Our future capital requirements will depend on many factors, including market acceptance of crypto assets and blockchain technology, our growth, our ability to attract and retain customers on our cryptocurrency exchanges, the continuing market acceptance of products and services, the introduction of new products and services on our cryptocurrency exchanges, expansion of sales and marketing activities, overall economic conditions, and expected changes in regulatory requirements that may increase minimum capital requirements as early as 2027. While we believe we have sufficient liquidity and expect to have funds from operations to support our operations and meet our current business plans, we may be required to seek additional funding to the extent that current and anticipated future sources of liquidity are insufficient to fund our future business activities. We expect to monitor financial conditions and from time to time may opportunistically raise additional funds through the offer and sale of equity securities or debt financing. Any sale of additional equity securities may result in additional dilution to our shareholders. Any additional debt financing would result in debt service obligations and the instruments governing such debt could provide for operating and financing covenants that would restrict our operations. In the event that additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at
all. If we are unable to raise additional capital or debt financing when desired, our business, operating results, and financial condition could be adversely affected.
Cash flows
The following tables show our cash flow data for the years ended March 31, 2026, 2025 and 2024:
| For the fiscal year ended at March 31, | |||||||||||
| (In millions) | 2026 | 2025 | 2024 | ||||||||
| Net cash provided by (used in) operating activities | ¥ (620) |
¥ (1,915) |
¥ 3,902 | ||||||||
| Net cash provided by (used in) investing activities | 279 | $ | (903.00) | $ | (435.00) | ||||||
| Net cash provided by (used in) financing activities | $ | 1,200.00 | 565 | $ | (327.00) | ||||||
| Effect of exchange rate change on cash and cash equivalents | 16 | 0 | $ | - | |||||||
| Net increase/decrease in cash and cash equivalents | 858 | $ | (2,253.00) | $ | 3,140.00 | ||||||
| Cash and cash equivalents at the beginning of year | $ | 8,584.00 | $ | 10,837.00 | $ | 7,697.00 | |||||
| Cash and cash equivalents at the end of year | ¥ 9,458 |
¥ 8,584 |
¥ 10,837 | ||||||||
Comparison of the year ended March 31, 2026 with the year ended March 31, 2025
In the year ended March 31, 2026, we had ¥620 million net cash used in operating activities, ¥279 million net cash provided by investing activities, and ¥1,200 million net cash provided by financing activities. As a result, cash and cash equivalents at the end of the year ended March 31, 2026 increased by ¥858 million, to ¥9,458 million, from ¥8,584 million at the end of the fiscal year ended March 31, 2025.
Net cash used in operating activities was ¥620 million in the year ended March 31, 2026, an improvement of ¥1,295 million from net cash used in operating activities of ¥1,915 million in the year ended March 31, 2025. This improvement was due primarily to a significantly narrower pre-tax loss of ¥875 million, compared to a pre-tax loss of ¥13,359 million in the year ended March 31, 2025, and the addition of share-based compensation of ¥1,320 million as a non-cash adjustment, partially offset by the non-recurrence of ¥13,714 million listing expense recognized as a non-cash adjustment in the year ended March 31, 2025, and a decrease in fair value gain on warrant liability of ¥312 million, compared to ¥1,435 million in the year ended March 31, 2025.
Net cash provided by investing activities was ¥279 million in the year ended March 31, 2026, an improvement of ¥1,182 million from net cash used in investing activities of ¥903 million in the fiscal year ended March 31, 2025. This improvement was due primarily to net cash acquired of ¥1,796 million in connection with the acquisition of subsidiaries, primarily 3iQ, partially offset by higher expenditure on internally generated intangible assets of ¥927 million compared to ¥524 million in the year ended March 31, 2025, and cash paid for acquisition of equity-accounted investees of ¥505 million.
Net cash provided by financing activities was ¥1,200 million in the year ended March 31, 2026, an increase of ¥634 million from ¥565 million the fiscal year ended March 31, 2025. The increase was due primarily to higher net proceeds from related party loans of ¥1,618 million in the year ended March 31, 2026 compared to ¥621 million in the year ended March 31, 2025, partially offset by the non-recurrence of proceeds from the non-redemption agreement and reverse recapitalization of ¥407 million received in the year ended March 31, 2025.
Comparison of the year ended March 31, 2025 with the year ended March 31, 2024
In the year ended March 31, 2025, we had ¥1,915 million net cash used in operating activities, ¥903 million net cash used in investing activities, and ¥565 million net cash provided by financing activities. As a result, cash and cash equivalents at the end of the year ended March 31, 2025 decreased by ¥2,253 million, to ¥8,584 million, from ¥10,837 million at the end of the fiscal year ended March 31, 2024.
Net cash used in operating activities was ¥1,915 million in the year ended March 31, 2025, a change of ¥5,817 million from net cash provided by operating activities of ¥3,902 million in the fiscal year ended March 31, 2024. This change was due to a net loss before tax of ¥13,359 million (compared to a net profit before tax of ¥2,840 million), partially offset by a listing expense of ¥13,714 million, which was non-cash expense. Additionally, there was a change in fair value of warrant liability of ¥1,435 million and an increase in other current assets of ¥846 million and income tax paid of ¥721 million.
Net cash used in investing activities was ¥903 million in the year ended March 31, 2025, compared to ¥435 million in the fiscal year ended March 31, 2024. Net cash used in investing activities mainly consisted of ¥236 million of net cash paid for the acquisition of Next Finance Tech Co., Ltd, in March 2025, and ¥524 million of expenditure on internally generated intangible assets (compared to ¥380 million in the prior period).
Net cash provided by financing activities was ¥565 million in the year ended March 31, 2025, compared to cash used in financing activities of ¥327 million in the fiscal year ended March 31, 2024, which was due primarily to ¥621 million of net increase in borrowings from related parties and proceeds from the Reverse Recapitalization.
Contractual Obligations and Commitments
The following table sets forth our aggregate annual maturities of lease liabilities for the next several years, as of March 31, 2026:
Carrying amount |
Contractual cash flow |
Within
1 year |
Within 1 - 2 years |
Within 2 - 3 years |
More than three years | |||||||||||||||
(in millions of yen) | ||||||||||||||||||||
Lease liabilities |
¥ 910 |
¥ 919 |
¥ 366 |
¥ 356 |
¥ 196 |
¥ - | ||||||||||||||
Total |
¥ 910 |
¥ 919 |
¥ 366 |
¥ 356 |
¥ 196 |
¥ - | ||||||||||||||
Off-Balance Sheet Arrangements
During the periods presented, we did not have, and we do not currently have, any off-balance sheet financing arrangements or financial partnerships, including entities sometimes referred to as structured finance or special purpose entities, that were established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.
Critical Accounting Policies and Estimates
Our consolidated financial statements are prepared in accordance with the IFRS Accounting Standards. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. We evaluate our estimates and
assumptions on an ongoing basis. Our estimates are based on historical experience and other assumptions that we believe to be reasonable under the circumstances. Our actual results could differ from these estimates under different assumptions or conditions. We believe that the following critical accounting policies reflect the more significant judgments, estimates and assumptions used in the preparation of our financial statements.
Crypto assets held
Our holdings of crypto assets that are considered to be controlled by us for accounting purposes are presented as a part of assets in our consolidated statements of financial position.
We determined that cryptocurrencies for facilitating customer transactions are accounted for under IAS 2 Inventories. Under IAS 2, such cryptocurrencies are initially recognized at the acquisition price and subsequently at fair value less costs to sell as these are held with the purpose of acquiring broker-traders' margin. The changes in fair value less costs to sell are recognized in profit or loss in the period the change occurs.
We use third-party exchanges to measure the fair value of its cryptocurrency. We select the principal market, which is the exchange with the highest liquidity and highest volume of trades. If a principal market does not exist, we select the most advantageous market, one with high liquidity, high volume of trades, the most favorable spread, maximizing the amount that would be received to sell the asset or minimizing the amount that would be paid to transfer the liability, net of transaction costs. Judgment is required in determining which exchange serves as the principal market or the most advantageous market for each type of cryptocurrency. Management reviews each exchange at period end and subsequently accounts for the crypto assets at fair value less cost to sell. The fair values of the crypto assets are considered to be Level 1 fair value measurements, which are unadjusted quote prices in active markets that are accessible at the measurement date for identical, unrestricted assets.
Crypto Asset Borrowing
We enter into contracts to borrow cryptocurrencies from our customers under the Coincheck Lending program. We record "crypto asset borrowings" with respect to our repayment obligation under the contracts. Crypto asset borrowings include all crypto assets which are deposited with the Company under the program regardless of whether the Company utilizes them for its borrowing activities. These crypto assets are recognized as inventories in the consolidated statements of financial position.
Crypto asset borrowings are initially measured at the fair value of the crypto assets borrowed/deposited. Subsequent to initial recognition, changes in fair value of crypto asset borrowings are recognized in profit or loss in the corresponding period. In addition, the fee expenses (calculated as in-kind interest on the amount borrowed) related to crypto asset borrowings are recognized over the borrowing period.
Revenue recognition
Transaction revenue
Transaction revenue from our Marketplace platform business and Aplo transactional business is derived from transactions with customers and cover counterparties.
We have a performance obligation to deliver cryptocurrencies for transactions with customers or with cover counterparties. Revenue is recognized at the point of time when performance obligation is fulfilled in accordance with IFRS 15 Revenue from Contracts with Customers.
Contracts with customers and cover counterparties to purchase or sell cryptocurrencies are usually open-ended and can be terminated by either party without a termination penalty. Therefore, contracts are defined at the transaction level and do not extend beyond the service already provided. When we receive cryptocurrencies as non-cash consideration, we measure the received cryptocurrencies at fair value at the time of delivery.
We have determined that we act as the principal in such transactions as we have the ability to direct the use of, and obtain substantially all of the remaining benefits from, the cryptocurrencies we hold as inventory before they are transferred to the Company's customers. Additionally, we are primarily responsible for fulfilling the promise to provide cryptocurrencies to customers pursuant to our terms of service, have inventory risk as we have no right to return unsold cryptocurrencies to the customers or cover counterparties from which we have purchased such cryptocurrencies, and set the price of the cryptocurrencies sold.
Research and Development, Patents and Licenses, etc.
See "Item 4B: Business Overview-Intellectual Property" and "Item 3D: RISK FACTORS-Risks Relating to Intellectual Property."
Trend Information
See "Item 4B: Business Overview-Our Market Opportunity" and "Item 3D: RISK FACTORS-Risks Relating to Our Business, the Crypto Industry, and Crypto Assets," as well as "Overview," "Monthly KPIs" and "Key Business Metrics and Trends" near the front of this section.