With the addition of Mr. Exchange and Tokyo Gateway, the number of cryptocurrency exchanges to shut down in Japan has gone up to 5. Ever since the world’s biggest cryptocurrency exchange hack resulting in over $530 trillion worth of cryptocurrencies being stolen from Coincheck, the Japanese Financial Service Agency has ramped up its efforts to implement its cryptocurrency regulation laws. This has resulted in some cryptocurrency exchanges to hand in their applications for license to operate cryptocurrency exchanges and effectively shut down their operational proceedings in the country of the rising sun.
It’s A Growing List
It only makes sense that the Japanese FSA has increased its efforts to be more stringent about the regulation of everything that has anything to do with cryptocurrencies. The Coincheck hack has dwarfed even the Mt. Gox controversy when it comes to cryptocurrency theft. With Mr. Exchange and Tokyo Gateway, the list has increased to 5 with biExpress, Bit Staion and Raimu having already withdrawn their applications for licensure to practice in the Japan.
The 8th of March saw Bit Station become one of the two cryptocurrency exchanges that the Financial Service Agency of Japan had given the directive to suspend all operational proceedings for a month. Simultaneously, the Financial Service Agency also issued their directives to Mr. Exchange and Tokyo Gateway to make improvements in their business practices along with 3 more cryptocurrency exchanges.
The reason why Bit Station saw the brunt of the Financial Service Agency’s regulatory measures and be ordered to halt their operations was because it was alleged by the agency that Bit Station had a senior official who made use of the cryptocurrency assets being held at the exchange for personal use. For all intents and purposes, such practices are not something that the Financial Service Agency will allow and it reprimanded the Bit Station cryptocurrency exchange for letting that happen. They felt that the operations of Bit Station should be put to a halt until the cryptocurrency exchange trains their employees better and installs trade monitoring systems which work more efficiently in order to prevent any future occurrences like this.
Cryptocurrency Regulation Is Imperative
Even though the whole concept when cryptocurrencies were initially made was that they would be free of regulatory control by authoritative bodies but with events like the Coincheck hack have made it clear that regulation is going to be necessary. April of last month saw the passing of the Virtual Currency Act in Japan which said that cryptocurrency exchanges in Japan have to apply for licenses again while others had their licenses reviewed by the Financial Services Agency.
The proceedings by the Financial Service Agency in Japan were not that strict but the Coincheck hack saw to it that they would aggressively pursue the implementation of regulations when it comes to everything that is related to cryptocurrencies. Considering the fact that the cryptocurrency exchanges that had the biggest thefts in the short history of cryptocurrencies were both based in Japan, the pursuit of the Financial Service Agency to implement better regulatory measures regarding cryptocurrencies makes sense.
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