Suspended Archives -
A total of nine cryptocurrency exchanges in Japan have suspended their operations so far. This includes the latest two, one of which was sanctioned by the Japanese financial regulator on Wednesday while the other voluntarily withdrew its license application.
Blue Dream Japan
The Japanese Financial Services Agency (FSA) issued a business improvement and suspension order to Blue Dream Japan Co. Ltd on Wednesday after an on-site inspection was carried out. The company must halt all activities related to its crypto exchange business from April 11 to June 10.
Following the FSA’s order, Blue Dream Japan issued a statement, “We will solemnly accept the business suspension order and business improvement order,” adding that they “promise to seriously respond, [and] we will do our utmost to resume our service.” Furthermore, the company wrote:
We hope to continue [our] virtual currency exchange business in the future after conducting thorough compliance with laws and regulations and improving the management system so that we can provide services that users can use with confidence.
Another company has also announced the withdrawal of its application with the FSA to operate a crypto exchange. Campfire, a leading crowdfunding site in Japan, operates the cryptocurrency exchange Firex, which was launched in March of last year.
The company has voluntarily suspended its crypto exchange services. “We aimed to fully renew [our] exchange system,” Campfire wrote and elaborated:
We have been preparing to register the virtual currency exchange…However, in order to build a perfect service system in terms of customer asset protection and convenience, we decided that [a] further review of the plan is necessary.
9 Exchanges Suspended Operations So Far
Prior to the hack of one of the country’s largest crypto exchanges, Coincheck, Japan had 16 licensed crypto exchanges and 16 “quasi-operators” of cryptocurrencies, also called “deemed dealers.” These are companies that have applied for licenses but have not been approved. Both Blue Dream Japan and Campfire fall into this category.
Coincheck was the first company to be sanctioned by the FSA since the Japanese Payment Services Act went into effect in April of last year. Following a business improvement order on January 29, the agency launched an on-site inspection of the exchange and subsequently proceeded to inspect all other exchanges as well. All quasi-operators received on-site inspections.
On March 8, the FSA issued business improvement orders to six companies. Four of them were quasi-operators – Mister Exchange, Bitcrements, Bit Station, and FSHO. The other two were fully licensed – Tech Bureau and GMO Coin.
Then on April 6, the agency issued administrative punishment orders to three exchanges – Lastroots, Eternal Links, and another to FSHO. The latter two were also ordered to suspend operations – Eternal Links from April 6 to June 5 and FSHO from April 8 to June 7. The latest company to receive a business suspension order is the aforementioned Blue Dream Japan.
In addition, a total of six crypto exchanges are reportedly withdrawing their applications following the inspections by the FSA – Tokyo Gateway, Mr. Exchange, Raimu, Bitexpress, Bit Station, and now Campfire.
What do you think of Japanese exchanges suspending operations? Let us know in the comments section below.
Images courtesy of Shutterstock, Blue Dream Japan, Campfire, and Nikkei.
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The Financial Services Authority of Japan has imposed penalties on three cryptocurrency exchanges following inspections of trading platforms in the country. Two of them have been ordered to suspend operations. Officials are not satisfied with the measures implemented to prevent money laundering and systemic risks.
FSHO, Eternal Link Suspended, Lastroots Told to Improve
The sanctioned crypto platforms – FSHO, Eternal Link, and Lastroots – have received orders to improve their business practices. These were issued by Japan’s financial regulator as part of the ongoing inspections of cryptocurrency exchanges. According to the Financial Services Authority (FSA), the penalties have been imposed because of unsatisfactory procedures to prevent money laundering and minimize systems risk.
The Japanese financial regulator has ordered two of the trading platforms to suspend their operations for two months. Eternal Link should halt activities from Friday, April 6, and FSHO was told to do the same on April 8, Reuters reports. Lastroots has received an order to improve its practices. Japan’s Minister of Finance is expected to present the full results of the investigations carried out by the FSA.
In March, FSA suspended two exchanges – the Nagoya-based Bit Station and again FSHO, which was ordered to terminate services until April 7. The agency said its operator was not performing thorough checks on large-scale transactions and had not implemented necessary measures “to run the exchange in a decent and assured way”. According to Japanese press, Bit Station was penalized because its senior officials were implicated in embezzlement of clients’ crypto deposits. Similar charges have led to the arrests of four high-ranking representatives of two cryptocurrency exchanges in South Korea.
In early February, FSA said it was inspecting all crypto trading platforms in the country, including 16 that were not registered at the time of the announcement. The financial authority published a list of 32 crypto exchanges, half of which had already obtained licenses to provide cryptocurrency exchange services.
Aftermath of a Huge Hack
Japan’s financial regulator undertook the revisions in the wake of the attack on Coincheck in January. Hackers stole ¥58 billion worth of NEM (~$ 550 million USD) from the Japanese exchange. Authorities are still investigating the heist, one of the biggest in crypto history. Cybersecurity experts have warned that half of the stolen NEM coins might have been laundered already on the darknet.
Cryptocurrency theft has become a major security issue in Japan, part of the growing cybercrime trend. Last year alone, $ 6.3 million worth of cryptocurrency was stolen, and that’s before the Coincheck hack.
Japanese authorities have decided to set up a center dedicated to combatting cybercrime, including crypto theft. 500 analysts and investigators from different branches of the country’s law enforcement agencies have joined the unit. At least 149 crypto-related attacks took place in 2017, Japan’s National Police Agency recently revealed.
Earlier this week, news came out that Tokyo-based Monex Group was considering buying Coincheck. On Friday, the deal with the online financial brokerage was confirmed. The team behind the hacked exchange has accepted the acquisition bid worth ¥3.6 billion Japanese yen (~$ 33.6 million USD).
Do you expect more cryptocurrency exchanges to be suspended by Japanese authorities? Share your thoughts on the measures taken by the FSA in the comments section below.
Images courtesy of Shutterstock.
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The post Two Crypto Exchanges Suspended by Japan’s Financial Regulator appeared first on Bitcoin News.
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