New changes will occur in the Japanese regulation related to the cryptocurrency usage. The financial watchdog institution plans to carry out detailed inspections of crypto exchanges.
The Japanese Financial Services Agency (FSA) is planning to inspect multiple crypto trading platforms located across the country, starting this week.
It all started when the Coincheck platform was attacked on 26 January 2018. The hackers took $ 531 million owned in NEM tokens. This incident has worsened the concerns of both crypto institutions and users about the security of the virtual coins usage. Thus, on 2 February 2018 the FSA has intervened directly at Coincheck’s office to inspect the situation and try to find a way to compensate the victims.
There are 32 crypto exchanges in Japan, but only 16 of them are registered and authorized by the Financial Services Agency as the law requires. The operators are asked to declare about “asset management, corporate governance and security”. However, not all of them follow the rules.
The purpose of the numerous raids realized by FSA is to improve the security across the digital currency system. According to the report of Asian Nikkei, “The scarcity of experts in internal auditing and cybersecurity raises concerns that companies will move slowly on improvements without scrutiny by regulators. The FSA is considering disciplinary measures including improvement orders for marketplace operators whose systems are found to be lacking.”
The number of attacks on companies that provide crypto services is increasing considerably. Perhaps, the FSA’s decision to inspect the cryptocurrency exchanges is one of the best solutions to protect them.
What’s your opinion about Financial Services Agency’s measures?