Japanese Financial Authorities Investigate Two Major Cryptocurrency Exchanges

Japanese Financial Authorities Investigate Two Major Cryptocurrency Exchanges

 
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Two major cryptocurrency exchanges, Huobi Japan Inc and Fisco Cryptocurrency Exchange Inc, are under investigation by the Financial Services Agency (FSA) of Japan, Reuters reports.

Exchanges are under scrutiny after both companies underwent major changes to management structures in recent months. The focus of the investigation is customer protection and anti-money laundering measures, as regulators continue to apply pressure on cryptocurrency exchanges to ensure that adequate compliance measures are in place.

Huobi Japan, a subsidiary of the Singapore-based Huobi Group, received its operating license from the FSA in January this year. Previously, Huobi Group had purchased cryptocurrency exchange BitTrade to enter the Japanese market.

“Japanese market is a very important one to us,” said Leon Li, founder and CEO of Huobi Group, following the receival of the licence.

Fisco Cryptocurrency Exchange, on the other hand, became operational this Monday after Fisco, an investment support services provider, acquired embattled cryptocurrency exchange Zaif from Tech Bureau.

Zaif suffered a major hacking attack last year when the attacker stole around digital assets worth around 6.7 billion yen ($60 million). Zaif’s hot wallets were raided and bitcoin, bitcoin cash, and MonaCoin were stolen in the end. Following the incident, Fisco agreed to acquire a majority stake in the company in exchange for $44.5 million.

This news come on the same day as media outlets reported about the intention of the Japanese Government to share its crypto regulation guidelines with other governments in the upcoming G20 summit.

A handbook, which outlines measures to prevent the outflow of virtual currencies, has already been prepared by the Government, and addresses areas such as protection of customer assets, measures against cyber attacks, and ways of providing information to customers.

Newconomy reported last year that Japan introduced the Japan Virtual Currency Exchange Association (JVCEA), with an aim to break the presence of money laundering activities in the cryptocurrency spectrum.