Japanese Regulators set new standards for local Crypto Exchanges
According to Cointelegraph, the FSA in Japan has updated their current regulatory guidelines for exchanges.
This is not surprising considering what happened with the Japanese based Coincheck, back in January.
If you do not recall, the Coincheck exchange was hacked to the tune of $532 million, which was the largest cryptocurrency exchange hack of all time.
It was a stern reminder that the current crypto wild west environment had to change, big time.
What are the recent updates/requirements from the FSA in Japan?
Besides just preventing a repeat of what happened with Coincheck, the FSA is requiring an updating of investor protection protocols just about at every corner.
Starting with the exchange's internal management systems.
Some of the main requirements are as follows:
- Exchanges will be required to monitor customer accounts multiple times per day for suspicious fluctuations.
- Exchanges will be required to hold client's assets separately from those of the exchange.
- Exchanges will be required to store crypto assets in offline systems only.
These changes are on top of the increasing know your customer (KYC) and anti money laundering (AML) measures already being taken.
ID verification and multi password entries will also be required for large transfers.
Here's the big one in all of this...
Apart from all of that there was one big thing that is likely to effect crypto markets, especially for a handful of coins specifically.
The local exchanges in Japan will no longer be able to trade anonymous coins. Coins such as Dash and Monero are effectively being banned from government registered exchanges in Japan.
This likely does not affect peer-to-peer exchanges, but it appears that the big major government registered exchanges will no longer be able to make markets in the anonymous coins.
Special inspectors will be sent to exchanges from time to time to make sure they are compliant with these new guidelines mentioned above.
All of this amounts to increased costs for exchanges.
Krakan has already announced that they will no longer be doing business in Japan due to rising costs of compliance.
Though costly, these new measures will provide a safer environment for investors and as measures like these get adopted globally, the odds of institutional type investors getting involved in the space increases substantially.
Which means overall, these are likely good things for the space.
Stay informed my friends.
Follow me: @jrcornel
This will be standard procedure in most jurisdictions very soon. Anon cryptos will thrive on real DEXes, but will not be allowed on most regulated marketplaces.
My thoughts as well.
@jcornel Happy to read your post. Timely and informative. I think is a positive signal. The countries have to regulate the crypto.
Believe it or not this is progress. The establishment are trying to come to terms with crypto!
Decentralized exchanges are future..controll this!
This is very informative and important news for japan. I live in Asia. But my cousin is staying in Japan due to job. I will inform him the news if he don't know the news yet. Thanks @jrcornel.
GO GO BITSHARES!
Decentralized, Trustless, Governmentless exchanges for the win! :D
It's pitiful to hear that a trade had been hacked previously. All things considered, let's get straight to the point that crypto trade isn't simply the blockchain for novices. The fortunate thing about this is, Japanese controllers still have inspirational standpoint over crypto which very guarantees its reality for quite a while.
An honor can read @jrcorne's post about you The Japanese regulator sets a new standard for Crypto Exchange local.
A tremendous preparation is visible rather than persaingn in the global market and this is a guide for all investors and companies around the world. The foundation that keeps this on preparing a demands is rather than the incredible competition.
This shows a remarkable turnaround. Turnover and exchange are the mainstay of investors to win this global market, showing a coherent preparation, thanks @jrcornel
This is something that is very useful for us
We win together
See you on the top
Yes, in Japan they want for crypto to be regulated, so they can not be accused of anything later.
This is common in most experienced traders, but in Japan; where discipline is a very importante principle; they are really pushing for this
Well, maybe people from all over the world will see this and stop thinking of crypto as this 'illegal' thing that can make you rich.
Take care
Yes, compliance rules will increase the costs of business. Also young Startups will have a harder time to develop and need more investments. On the other hand, the regulation will bring more stability for the crypto space.