Japanese only high-frequency trading firm Dharmacapital has moved its entire workforce from Tokyo to Singapore, highlighting the growing challenge facing the country as it competes with other Asian financial centres for trading talent and market-making businesses, according to a report.
The relocation was completed earlier this month, according to people familiar with the matter. Dharmacapital’s Singapore entity will now serve as the firm’s operating base, although Japan remains its largest market.
Akiyoshi Shiotani, chief executive of Dharmacapital’s Singapore operation, said the move was primarily intended to improve the firm’s access to global markets. He added that the company would continue providing liquidity to Japanese markets and supporting trading efficiency there.
The departure is significant because Dharmacapital was the only high-frequency trading firm based in Tokyo among 53 such entities registered to participate in Japanese markets, according to the country’s Financial Services Agency’s list as of July.
Most of its international peers, including Citadel Securities, Virtu Financial and Jane Street, operate their Asian trading businesses from Singapore or Hong Kong rather than Tokyo.
Japan has long sought to strengthen Tokyo’s position as an international financial centre, but the city faces competition from regional hubs that can offer more attractive tax regimes and easier access to international financial talent.
Japan’s relatively high personal tax burden is one factor that has been cited by finance professionals when considering Singapore and Hong Kong as alternatives. Language and regulatory considerations have also contributed to Tokyo’s difficulties in attracting overseas financial firms and personnel.
Singapore is seeking to reinforce its position as a hub for investment firms. The city-state recently proposed additional tax incentives for fund managers, while Hong Kong has also been working to attract hedge fund and asset-management talent.
The competition is particularly relevant for high-frequency and algorithmic trading firms, where proximity to sophisticated financial infrastructure and access to international markets are critical.
Dharmacapital’s relocation does not mean the firm is retreating from Japan. The company plans to continue trading in Japanese markets and providing liquidity from Singapore.
Market-making firms have become increasingly important to trading activity in Tokyo. They have accounted for more than 30% of trading value on the Tokyo Stock Exchange since at least 2024, according to Japanese regulatory research.
