Japan’s cryptocurrency industry eyes self-regulation

Japan’s cryptocurrency industry is reportedly preparing to establish a self-regulatory body.

A group of Japanese cryptocurrency exchanges are uniting to create a self-regulating body following the Coincheck hack earlier this year according to Nikkei. The move comes after the Coincheck exchange had $533m-worth of NEM tokens stolen in a security breach last month.

Sixteen registered virtual currency marketplace operators and executives from some unregistered ones attended a closed meeting in Tokyo on Tuesday to discuss the new organization, the publication added.

The Japan Cryptocurrency Business Association and Japan Blockchain Association were reported to be eyeing a merger. However, the exchanges have opted to form a new organisation that would be registered with the country’s financial watchdog, the Financial Services Association (FSA) according to report from Reuters, which two sources familiar with the deal.

Officials at the Japan Cryptocurrency Business Association and the Japan Blockchain Association did not immediately respond to a request for comment.

Taizen Okuyama, president of foreign currency trading service provider Money Partners Group, is expected to be the new organization’s chairman. The vice chairman is expected to be Yuzo Kano, CEO of bitFlyer, the country’s top cryptocurrency marketplace operator, according to Nikkei.

Spokespeople for Money Partners Group, bitFlyer, Okuyama and Kano could not be reached for comment.

The new body will work to create fair trade rules and use self-regulation to plug loopholes in the law. In addition to discussing the direction of virtual currency policy and legislation with the government, the new organization will define its regulatory policy on issues like insider trading, advertising and security. It will also set penalties for members that do not follow these rules.

Seven cryptocurrency companies in the UK recently formed a cryptocurrency trade body, bringing the first self-regulation to the industry. With the sector growing in popularity and calls on the government to introduce appropriate regulation to protect consumers and business certainty, CryptoUK will look to promote the development and recognition of digital currency technologies in the UK.

Earlier this month, the Swiss Financial Market Supervisory Authority (FINMA) said it intends to regulate some ICOs either under anti-money laundering laws or as securities.

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