The Japanese Financial Market Authority (FSA) has issued a series of new guidelines for the regulated trading of crypto currencies. These new rules are aimed both at the country’s crypto exchanges and at various companies operating in the blockchain sector. Japan is thus continuing to create a regulated environment for the sustainable growth of the crypto economy.
Japan continues to work on a regulated ecosystem for trading crypto currencies. In the past year, Bitcoin was officially recognised as a legal tender. However, this was accompanied by government regulations that were to apply equally to financial service providers and crypto trading centres. Japan therefore opted for a proactive attitude towards crypto currencies, in which the ecosystem gets the chance to grow, but has to adhere to certain rules.
Promoting and calling for healthy crypto trader market development
Since the law came into force, the Financial Market Authority has started to clean up the crypto trader market. For example, all trading centres for crypto currencies had to undergo a state examination: https://www.onlinebetrug.net/en/crypto-trader-review/ The focus was on the implementation of anti-money laundering guidelines and compliance with the know-your-customer principle.
In the course of the investigations, a total of eleven crypto exchanges were initially granted an official license, with more being added later. The selected crypto exchanges were now equipped with a legal security that helps both the exchange operators and the crypto investors in the long-term trading of crypto currencies. Compared to the regulation of the traditional financial industry, however, crypto exchanges are still on a comparatively long leash.
The next step now follows
Now the FSA is tightening up the selection process for the licensing of crypto exchanges. According to the local newspaper Japan Times, the number of questions asked during the audit was increased to about 400. It now obliges applicants to submit minutes of board meetings. The aim is to check whether sufficient discussions have taken place on the safety and financial health of the company.
This is the Japanese government’s reaction to the experience it had with the Coincheck stock exchange at the beginning of 2018. The theft of NEM worth the equivalent of 430 million euros dealt a small blow to the FSA’s efforts to establish a healthy crypto ecosystem.
Japan: The shining example in East Asia
Japan is thus in sharp contrast to its East Asian neighbours, who fluctuate between hardness and helplessness when dealing with crypto currencies. When trying to control the uncontrolled growth on the crypto market by means of ICO bans and the closure of crypto exchanges, both fail to recognize that in the end crypto businesses are only driven more into illegality. Thus one takes the possibilities of state control over oneself. At the same time, they are depriving themselves of the potential that this growth market brings with it.
In Japan, on the other hand, it is precisely these potentials that are being exploited. To achieve this, the enormous growth is channelled into an orderly course through clear regulation. This is exactly the right measure to create a healthy crypto ecosystem. It also creates security and trust in crypto currencies and blockchain technology. Unfortunately, we in Europe are still waiting in vain for such an initiative.