Japanese Financial Services Agency to Change Crypto Exchange Regulations
July 03 2018 - 9:48AM
ADVFN Crypto NewsWire
Japanese financial regulator the Financial Services
Agency (FSA) is considering to change the legal basis for how it
regulates cryptocurrency exchanges, local media Sankei reports July 3.
The FSA reportedly is considering to regulate crypto
exchanges by the Financial Instruments and Exchange Act (FIEA),
instead of its current legal foundation, the Payment Services Act.
According to Senkai, this means that the exchanges will have
stronger customer protections. The FIEA obliges securities
companies to manage customer funds and securities, such as stocks,
separately from corporate assets.
Under the current legislation, cryptocurrencies are
legally positioned as the same means of payment as electronic
money. Should the FSA start regulating exchanges under the FEIA,
crypto will be treated as a financial product. The FIEA will also
open up the possibility of introducing crypto derivatives like
exchange traded funds (ETF).
Sankei writes that the 523 million NEM hack at
Coincheck early this year contributed to the FSA considering a
different legal foundation for crypto exchanges. Following the hack, the FSA
launched investigations into 15
unregistered exchanges, where it found a variety of security and
regulatory shortcomings in the exchanges’ business operations.
Earlier this month, the Virtual Currency Exchange Association
(JVCEA) announced a new set of voluntary
rules. The self-regulatory exchange body aims to better align with
existing anti-money laundering (AML)
regulations, and will also prohibit the trading of anonymity-based
cryptocurrencies like Monero and Zcash.
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