Japan’s financial regulator plans to impose stricter crypto rules

[ad_1]

Japan’s financial regulator, the Financial Services Agency (FSA), has started discussions on imposing stricter regulations for cryptocurrencies in an effort to provide better protection for Japanese investors.

In July, the FSA created a dedicated section, as well as a panel of financial experts to help the government oversee digital and decentralized finance. The agency will also be responsible for monitoring developments in the central bank’s cryptocurrency and digital currency initiatives (CBDC), as reported by Jiji Press.

The financial regulator intends to replace and enforce the new crypto regulations by mid-2022. With the new regulations in place, the FSA hopes to bring stability to the crypto market while ensuring no damage to development and innovation within the ecosystem.

The FSA revised a similar law in 2019, which effectively mandated crypto exchanges in Japan to implement new features to protect user assets. The move was linked to the hack of Bitpoint, a Japan-based crypto exchange that suffered a loss of $ 32 million.

In addition to the recent hack into the Liquid crypto exchange, the FSA further believes that operators nationwide have yet to implement sufficient anti-money laundering and price volatility measures.

Related: Japanese FSA Asks Cryptocurrency Industry Group To Introduce FATF Travel Rule

Earlier this month, the FSA announced that it will adopt the FATF travel rule by 2022, which will require all service providers dealing with cryptocurrencies to share transaction data. The travel rule was introduced in 2019 as a preventative measure against money laundering and terrorist financing with cryptocurrencies.

The reader will be supported by the Japanese Virtual Currency Exchange Association in order to establish a system necessary to accurately implement this travel rule.

[ad_2]