Two More Japanese Exchanges Halt Their Operations in the Wake of Coincheck

Tokyo Gateway and Mr. Exchange (based in Fukuoka) have become the latest two exchange to halt their operations as the result of the Japanese Financial Service Agency’s increasing enforcement of virtual currency laws. The FSA has tightened its grip on cryptocurrency-related activity within the country following the $532 million Coincheck hack earlier this year. Both will be returning customer funds before closure is official.

According to a report by Nikkei, the two exchanges withdrew their applications for licensure under the Japanese Virtual Currency Act, along with three other exchanges: Raimu, bitExpress, and Bit Station.

No official statements have been given by either exchange.

A growing list of closures

On March 8, Bit Station became one of two exchanges that the FSA ordered to suspend service for a 30-day period; at the same time, the agency issued business improvement orders to five other exchanges - Mr. Exchange and Tokyo Gateway were among them.

Bit Station was reportedly targeted by the FSA after it was revealed that a senior official at the exchange had allegedly routed deposits of digital currency for his own use; FSHO’s operations were halted after the FSA determined that the exchange had failed to properly train employees and install an appropriate trade-monitoring system.

Nikkei reported that more exchanges are expected to withdraw their applications for licensure because of inability to meet the FSA’s requirements. The FSA has reportedly given fallen exchanges an opportunity to withdraw their applications before they are “[ordered] to do so.”

Crypto Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term - a ‘necessary evil’

Cryptocurrency exchanges were originally required to apply for licensure starting in April of 2017, when the Virtual Currency Act was passed. Sixteen exchanges were granted licenses, while another sixteen were allowed to continue their operations while their applications were under review.

Following the Coincheck hack, however, unlicensed exchange have been scrutinized more heavily by the FSA. The agency launched a series of on-site inspections for crypto exchanges in early February.

Japan has paved the way as perhaps the most forward-thinking country on the planet when it comes to cryptocurrency regulation. As the home of the two largest exchange hacks in history--Coincheck and Mt. Gox Mt. Gox Mt. Gox is the name of a Japan-based cryptocurrency exchange that was infamously hacked for 850,000 BTC worth roughly $450 million at the time in February of 2014. During July 2010 Mt. Gox formally launched Mt. Gox launched its exchange and price quoting service. It was subsequently sold to French developer Mark Karpelès in early 2011.Prior to its hacking, Mt. Gox suffered from other security vulnerabilities as early as June 2011. On 19 June, 2011, a security breach of the exchange caused the no Mt. Gox is the name of a Japan-based cryptocurrency exchange that was infamously hacked for 850,000 BTC worth roughly $450 million at the time in February of 2014. During July 2010 Mt. Gox formally launched Mt. Gox launched its exchange and price quoting service. It was subsequently sold to French developer Mark Karpelès in early 2011.Prior to its hacking, Mt. Gox suffered from other security vulnerabilities as early as June 2011. On 19 June, 2011, a security breach of the exchange caused the no Read this Term--the country has had to be.