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Japanese Bitcoin exchanges under control of supervision from October

The Japanese Financial Services Agency (FSA) will begin to monitor the exchange of cryptocurrencies more closely next month.

25.Sep.17 2:12 PM
By Daria Zaytseva


Japanese Bitcoin exchanges under control of supervision from October

According to the Japan Times, the increased control is aimed to ensure that the companies comply with the revised law on payment services, adopted in April this year, which set out operational standards for exchange, and is also recognized bitcoin as a legal tender.

Reportedly, the FSA executive director indicated that oversight is intended both to regulate exchanges and to ensure the healthy growth of the cryptocurrency market.

The law on payment services, adopted earlier this year, established anti-money laundering and know-your-customer rules for the exchanges. The law is also designed to ensure compliance with security standards to protect the exchange from the risk of cyberattacks.

The law provides that all exchanges must report to the authorities before the end of September to confirm their compliance with the new rules. The FSA also has the authority to conduct on-site inspections, if it deemed necessary.

To monitor more than 20 cryptocurrency exchanges operating in Japan, the FSA last month set up a specialized surveillance team, which reportedly includes 30 employees.

Japan is no stranger to cryptocurrency based fraud, with 33 cases that represent losses of more than half a billion dollars, reported in the first seven months of 2017.

In addition, in 2014, the recently known Japanese bitcoin-exchange Mt Gox collapsed, which led to the loss of millions of dollars in customerís funds. Japanese lawmakers earlier referred to the failure of the exchange as a key factor in the process of regulating the cryptocurrency industry.

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