FSA Responds to Reports of Cryptocurrency Regulation Changes
A response was issued by Japan’s FSA concerning reports that the authority is considering a revamp of its current regulations placed on cryptocurrencies and exchanges operating within its borders.
The financial authority has been heavily criticized by the media and public due to the inefficiency of its implemented regulations regarding the registration process which which all cryptocurrency exchanges must comply.
According to a report by a local newspaper, the FSA has been considering a change of law, switching to the FIEA as opposed to the current rules in place. Should the financial authority forsake the current revised settlement law and opt for the FIEA, cryptocurrencies will become a financial product instead of a settlement tool.
As the financial act mandates, managing customer funds and assets must be separated from corporate assets by all companies operating accordingly. A stronger and more secure system to protect customer assets must also be implemented.
After contacting the FSA to confirm media reports, Impress Capital received a response from the agency saying that nothing pointed to any legitimacy behind the claims. According to the outlet, several meetings are consistently held by leading figures in each respective field, including several members of the cryptocurrency industry as well as academics and financial experts, to address rising issues involved in the cryptocurrency scene.
As reported by the news outlet, the FSA responded by stating that any debates regarding the change of system will be part of the agency’s agenda should they rise, and that anything which is not a part of the group members’ agenda will not be considered.
A partner at Anderson Mori & Tomotsune, a Japanese law firm, said that a decision to switch financial regulations surrounding cryptocurrencies may occur- although it would take time and no changes would be made anytime soon.
In April, the FSA enforced the revised fund settlement law as a means for cryptocurrencies to legally operate and register their businesses with the agency. In total, 16 different exchanges have received green-lighting by the FSA to continue business and operations.
Following the infamous Coindesk hack earlier this year, the FSA has paid closer attention the licensed exchanges operating in Japan. They discovered that two of these exchanges did not live up to the requirements applied by the law. GMO Coin and Tech Bureau were handed improvement orders to update their internal systems in accordance with regulations.
Six additional crypto exchanges were handed business improvement orders, with Bitflyer, China's leading cryptocurrency exchange, amongst them. The initial publication, which filed the earlier reports, has stated that if the FSA changes occur, it will lead to a more effective customer protection.