The Japan Virtual Currency Exchange Association requested certification from the country's leading financial regulatory authority, the Financial Services Agency. It is now planned to work with the government on drafting and overseeing legislation that will allow the Japanese cryptic exchange industry to self-regulate.
The JVCEA, which now claims to represent all 16 cryptographic exchanges approved by the Japanese government, has announced on Friday that the certification will allow it to become "an association of companies for the management of certified funds"
By this, it is said that it will be able to act as self-regulatory organism for the cryptocurrency industry in Japan, providing "indications and recommendations to members to comply with regulations, laws and rules of self-regulation ".
Japan is considered to have some of the clearest rules on virtual currency and, in 2016, was the first country in the world to recognize Bitcoin as legal tender.
However, he took the regulatory tensions from the $ 450 million of Mt Gox in 2014 and attempted to strengthen government oversight of the industry while allowing the encryption business to continue to grow.
Using the current Payment Services Act, the Financial Services Agency introduced for the first time the registration requirements for virtual currency exchanges in 2014 and introduced regulations for the protection of users. and customer identification. These were reactions to the Monte Gox hack, but also measures to counter the widespread use of virtual currencies for money laundering and terrorist financing. After the $ 520 million hack of another Tokyo stock exchange, Coincheck, at the start of 2018, the FSA requested that all exchanges pass through a formal registration process and place an absolute ban on all forms of insider trading.
The JVCEA, formed after the Coincheck robbery with the goal of restoring public confidence in the Japanese cryptography industry, says that certification with the Financial Services Agency will allow it to be able to contribute "to the solid development of the virtual currency sector and to the protection of user interests."
The FSA certification process, according to To-Ni Nippo Press, will have to go through a two-month review by the regulator who "will carefully examine the affairs of the Association and will investigate whether an appropriate group management can be envisaged."
The Association has, according to the Nikkei Asian Review, presented a detailed 100-page document of its self-regulatory measures proposed to the FSA, and The potential costs of exchanges to become fully compliant are becoming a matter of concern, with a member of the Association who he tells Nikkei that "we are subject to almost harsh rules such as financial instruments and the Exchange Act".
The extensive range The 2006 act governs the major regulations on Japanese securities, and was established after a series of corporate scandals rocked the country towards the end of the years & # 90; and the beginning of the 2000s.