Japanese crypto market to face expansion of crypto rules

Posted 02 September, 2019

The Financial Services Agency (FSA), Japan's main financial regulator, intends to optimize the cryptocurrency market in the country. It is reported that the agency decided to introduce new rules that can improve the Japanese cryptocurrency market and provide the FSA with constant communication with international regulatory authorities.

The Financial Services Agency in cooperation with the Japan Virtual Currency Exchange Association (JVCEA), has published a document entitled Practice and Future Financial Management Guidelines.

JVCEA is one of the self-regulatory associations in Japan, which unites the country's licensed exchanges, as well as many companies engaged in the cryptocurrency market.

In the new document, the FSA intends to coduct stricter monitoring of cryptocurrency exchanges, focusing on the infrastructure providing cybersecurity. Tighter security controls on exchanges was launched after the hack of the Coincheck exchange in 2018 and most recently the Bitpoint one this July.

Amendments to the Law on the Settlement of Funds and the Law on Financial Instruments and Exchanges, which are due to enter into force by the first half of 2020, include the renaming of cryptocurrencies into crypto assets and the tightening of provisions on transactions with cryptocurrency derivatives. 

According to the regulator, between FSA and JVCEA there is a constant exchange of information and partnership work is developing to improve the legislative framework of the Japanese cryptocurrency market. FSA closely monitors the emergence of new financial instruments based on blockchain and cryptocurrency. To ensure investor protection, the agency constantly studies, monitors and monitors new financial instruments and predicts threats to investors coming from them.

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