In the fast-paced world of digital assets, Laser Digital, a subsidiary of the Japanese financial services giant Nomura, is finding that the road to profitability may be longer and more challenging than initially anticipated. Despite earlier projections, the company now faces headwinds caused by the recent turbulence in the crypto sector.

Laser Digital had set its sights on achieving profitability by 2024, but a candid interview with CEO Jez Mohideen revealed that unforeseen obstacles have cast a shadow over those ambitious goals. In an exclusive conversation with Bloomberg, Mohideen acknowledged that the company’s bottom line is feeling the impact of the crypto industry’s turmoil, necessitating a reevaluation of their timeline for achieving profitability.

Mohideen elaborated on the situation, saying, “Our profitability journey may take a bit longer than we forecast a year ago. Volumes have come down, activity has shrunk, regulators’ needs are changing – all these are leading to some delays in our overall journey, including profitability.”

This announcement marks a significant departure from the optimism expressed in December 2022 when Mohideen confidently stated that Laser Digital would be in the black within two years. At that time, the crypto industry was reeling from the spectacular failure of Sam Bankman-Fried’s FTX exchange, which sent shockwaves through the market and wiped out a staggering $2 trillion in crypto market value.

“The crash had a profound impact on our industry,” Mohideen admitted, acknowledging the widespread repercussions that affected not only Laser Digital but numerous other exchanges and crypto-centric firms.

Despite the grim outlook, Laser Digital remained resolute, running rigorous stress tests to account for worst-case scenarios, including market volume fluctuations and price volatility. Back then, Mohideen remained steadfast, stating, “We believe we can turn profitable within two years.”

However, the path to profitability is not the only aspect of Laser Digital’s strategy that has been impacted by recent events. The company had also laid out plans for substantial workforce expansion by March, driven by the belief that acquiring talent and assets at lower valuations during uncertain times was a prudent move. To date, Laser Digital has successfully brought on board 70 new staff members and intends to add an additional 20 over time.

In a bid to strengthen its global trading business, the crypto subsidiary of Nomura is in the process of establishing an office in Tokyo, which will provide vital support to its operations worldwide. Mohideen revealed, “The company will hire 4 to 6 people in its Tokyo office,” underlining its commitment to expanding its global presence.

Despite the current challenges, Mohideen remains optimistic about the future, thanks in part to the increasing participation of institutional investors in the crypto sector. He emphasized that the entry of institutions and institutional projects, even in the face of market volatility, instills confidence in the long-term prospects of the industry. High-profile names such as BlackRock and other financial institutions have recently entered the market’s bull run, signaling a shift in the traditional financial landscape.

“The future is brighter, but it may take longer,” Mohideen concluded, hinting at the resilience of both Laser Digital and the broader crypto industry. As they navigate the complex and ever-evolving crypto landscape, it becomes evident that adaptability and strategic foresight will be key to overcoming the challenges and uncertainties that lie ahead.