The Japanese Regulator Published the Results of Its Audits and Studies
The financial regulator of Japan, the Financial Services Agency (FSA), published a report, which shows the results of inspections of several crypto exchanges. Based on their observations, the regulator decided to apply a more rigorous method for selecting crypto exchanhges that wish to obtain a license.
According to the research, for the year the total volume of digital assets on the domestic crypto exchanges has increased more than 6 times and currently stands at about $7.1 billion, which in local currency is 792.8 billion yen. Nevertheless, the number of people employed at one such average exchange reaches only 20 people. This means that one employee of the exchange manages assets amounting to 3.3 billion yen or $29.7 million.
According to the regulator, business models, which are managed by many crypto exchanges, should be revised. Also under the vigilant view of the regulator came the fact that quite a small amount of attention is paid to combating money laundering and fraud on certain exchanges. FSA announced that a more thorough process of registration of new crypto exchanges will be required, and that "priority will be given to protecting investors". This is due to the consequences of the large-scale hacking of Coincheck in January of this year, when the amount of losses was $532 million.
Recall that the FSA has already begun to tighten rules for registered exchanges. So, in May, restrictions were imposed on the trading of altcoins, which position themselves as anonymous. In addition, the regulator is considering the possibility of changing the legal framework for better regulation of the cryptocurrency sector and the work of exchanges. And at the moment hundreds of applications from cryptocurrency companies are already under consideration.