The Japanese regulator clarifies the position on ETF and Bitcoin derivatives

January 13, 2019 Bitcoin

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Regulations

The main Japanese financial controller clarified to news.Bitcoin.com its position on the funds exchanged in bitcoins (ETF), cryptocurrency derivatives and imminent regulatory changes. This follows reports that the agency could consider approving an ETF that tracks cryptocurrencies.

Read also: The Indian Supreme Court moves the cryptographic hearing, the community asks for positive regulations

ETFs and Bitcoin derivatives

Following recent reports stating that the Japanese Financial Services Agency (FSA) could consider the approval of one or more bitcoin ETFs, the news.Bitcoin.com have asked the main financial regulatory body of the country to confirm its plan on this type of investment instrument.

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An agency spokesperson clarified on Friday:

There is no fact that we are considering approving ETFs that currently track crypto-activity … we are not currently considering approving them.

The FSA also confirmed its position on cryptocurrency derivatives. Regarding "the listing of bitcoin futures on the financial instruments market", the regulator said: "At the moment we are not considering it".

The agency explained its reasoning to the news.Bitcoin.com, stating that based on the results of the study group on virtual currency exchange services:

Given that it is difficult for us to find constructive and social significance in the trade in cryptographic derivatives, we believe that it is not necessary to trade derivatives on cryptocurrencies in financial instruments in which many market participants are able to negotiate.

New regulatory direction

The FSA has recently published the new rules proposed for crypto operators based on discussions and conclusions of 11 study group meetings. Self-regulation will play an important role in the ecosystem. In October, the agency approved the Japan Virtual Currency Exchange Association (Jvcea) as a self-regulating organization (SRO).

The association "is expected to perform the self-regulatory functions in a flexible way, considering the problems we have identified so far," the agency told news.Bitcoin.com.

The FSA proceeded to outline the issues that it expects the SRO to focus on. It is "insufficient valuation of the risk of crypto assets to be managed, inadequate sales of encrypted assets issued by the providers themselves, excessive advertising, excessive emphasis on the generation of profits, no control and balance by directors and auditors, no internal control, management control insufficient internal, insufficient AML / CFT measures and segregation of client activities and reluctance to disclose company information ".

ICO Regulations coming soon

When Japan has legalized cryptocurrencies as a means of payment in April 2017, initial coin offerings (ICOs) and their tokens have not been included. However, with the growing interest in token sales as a fund-raising method, the FSA has turned its attention to the issue. The agency has recently published a document outlining the key areas that will be dealt with in the coming regulations.

The FSA will focus on "investment ICOs" and "will clarify that the solicitation of investments through virtual currency financing is subject to financial regulations", reads the document.

<img class = "size-full wp-image-274432 aligncenter” title=”The Japanese regulator clarifies the position on ETF and Bitcoin derivatives” src=”https://news.bitcoin.com/wp-content/uploads/2019/01/ico.jpg” alt=”The Japanese regulator clarifies the position on the ETFs and Bitcoin derivatives "width =" 5944 "height =" 3340 "srcset =" https://news.bitcoin.com/wp-content/uploads/2019/01/ico .jpg 5944w, https: //news.bitcoin.com/wp-content/uploads/2019/01/ico-300×169.jpg 300w, https://news.bitcoin.com/wp-content/uploads/2019/01 /ico-768×432.jpg 768w, https://news.bitcoin.com/wp-content/uploads/2019/01/ico-1024×575.jpg 1024w, https://news.bitcoin.com/wp-content/uploads / 2019/01 / ico -696×391.jpg 696w, https://news.bitcoin.com/wp-content/uploads/2019/01/ico-1392×782.jpg 1392w, https://news.bitcoin.com/wp -content / uploads / 2019 /01/ico-1068×600.jpg 1068w, https://news.bitcoin.com/wp-content/uploads/2019/01/ico-747×420.jpg 747w "sizes =" (maximum width: 5944px) 100vw, 5944px”/> Specifically, "When soliciting 50 or more investors", the agency intends to "request the issuer to provide public disclosure initially and subsequently".

ICO brokers and dealers of investment type will be regulated "at the same level as securities companies". They will be required to "examine the economic and financial conditions of the issuer". Furthermore, both the current "unfair commercial regulation" and the rules to prevent insider trading will apply. There will also be restrictions on "soliciting retail investors in the same way as the restriction on unlisted stocks". For other types of ICOs, the FSA plans to request cryptographic exchanges to take care of them "to provide information including the feasibility of the project".

What do you think of Japan's approach to cryptocurrency regulation? Let us know in the comments section below.

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The Japanese regulator clarifies the position on ETF and Bitcoin derivatives

ETFs and Bitcoin derivatives

New regulatory direction

ICO Regulations coming soon

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