Japanese crypto exchanges submit formal proposal for self regulation

posted 10 months ago
A group of Japanese cryptocurrency exchanges have formally submitted a detailed proposal to form a self-regulatory organization to the nation's Financial Services Agency. The Japan Virtual Currency Exchange Association, which was formed by 16 exchanges in March and registered with the FSA in April, has applied to become a "certified fund settlement business association." This would effectively allow the JVCEA to impose self-regulatory rules on the cryptocurrency trading market as part of an effort to create stricter industry standards.

A working draft of the proposed rules in the nearly 100-page document would require cryptocurrency exchanges to regularly conduct audits, as well as prohibit certain anonymous cryptocurrencies from being traded such as Monero. The JVCEA said it also wished to limit the amount of borrowing when it came to margin trading, that is trading with borrowed money, to be at a maximum of 4x an investor's original deposit. These are suggestions by the association aim to prevent repeats of troubling incidents such as the Coincheck hack in which an estimated $533 million was taken from the exchange's digital wallets.
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