Japan – Billionaire365

Cryptocurrency Exchange Platforms In Japan Should Obey New, Stricter Regulations

Cryptocurrency exchange platforms across Japan should now follow a more stringent procedure to conduct their operations legally, after the country’s financial authority has strengthened its evaluation system in this area.

Sources at the Financial Services Agency (FSA) told The Japan Times that the new rules aim to ensure that future cryptocurrency exchange platforms are carrying out proper risk management. The FSA evaluation process had been suspended after 58 billion Yen (about $530 million) was stolen from customers in January following a cyber attack on the Japanese exchange house Coincheck.

Applicants now have to answer to about 400 inquiries, almost four times more questions than in the original procedure, the Japanese news portal reported. Additionally, the evaluations provide for on-the-spot inspections by the FSA to verify the truthfulness of the answers.

Among the new requirements that candidates are required to submit, there is information regarding the board meetings which gives clues about the financial health of the company and the security of its IT system. This data also allows FSA officers to assess whether company executives are adequately involved in decision-making.

The hacking of the Coincheck platform forced the Japanese authorities to tighten up the control over cryptocurrency exchange companies

The control over the cryptocurrency exchange platform conducted by the Japanese financial authorities was tightened after the multi-million dollar robbery on Coincheck.

By March, five Japanese crypto trading platforms had already closed their doors because they were unable to comply with the Financial Services Agency (FSA) regulations. Others were temporarily suspended by the agency to catch up with the regulations.

Additionally, in April, a group of sixteen FSA-approved cryptocurrency exchange platforms across Japan set up the Japan Virtual Currency Exchange Industry Association with the aim of establishing self-regulatory measures to protect users and prevent cases such as the one that involved Coincheck.

More recently, in June, the FSA issued orders for commercial upgrades to six crypto trading platforms after conducting on-site inspections. The measure required operators to improve their internal audit and user protection systems.

Anna Galvez

HitBTC cryptocurrency exchange platform has suspended its services for investors residing in Japan. This decision was taken in order to avoid any problems with the country’s cryptocurrency regulation. Indeed, the latter did not authorize HitBTC to operate in Japan and users with Japanese IP addresses will be asked to provide information about their residence as part of the customer identification procedure (KYC). This will also identify investors who do not live in Japan.

HitBTC services shut down its operations in Japan

HitBTC, the 8th largest cryptocurrency exchange platform in the world, according to CoinMarketCap, has announced the suspension of its services for Japanese residents.

On its website, the Hong Kong-based company has added a new section entitled “Restriction of Services”, under the “Terms of Use” section.

For example, there can be read that “you must not use our services and immediately stop using them if you are a resident of a country where HitBTC is not authorized to operate.”

The company said that if the platform detects the use of its services from an IP address registered in Japan it will be asked to confirm if the user does not reside in Japan. Another publication was made by the company confirming the suspension of its services in Japan.

The decision came in respect with the cryptocurrency regulations adopted by Japan

The Japanese payment services law regarding the cryptocurrency regulations, which caused HitBTC cryptocurrency exchange platform to end its services on the Asian country’s territory, came into force in April.

This regulation legalizes cryptocurrencies but it also requires that all cryptocurrency exchange or trading companies operating in Japan to be registered with the country’s financial authority, the FSA.

To date, 16 platforms for the cryptocurrency exchange activities have received an operating license. They were thus authorized to operate in Japan.

The Japanese financial regulator has also warned some companies that continue to operate in Japan without such authorization, and HitBTC was one of them.

Anna Galvez