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People holding cryptocurrency in exchanges based in Japan apparently increased their holdings of bitcoin, Ethereum and Ripple over the past few months. BTC, ETH and XRP are the three largest cryptocurrencies in the industry by market cap.
Japan Is Still a Major Crypto Hub
The surge in holdings appears to stem from the spread of the coronavirus, which has led to the shuttering of the global economy and the ravaging of global financial tools. The virus first began to spread in late 2019, but by March of this year, had made its way over to the United States, the United Kingdom, Europe, and other parts of Asia. It has also spread to various regions of South America, making it one of the most widespread pandemics in recent years.
However, while the virus has undoubtedly led to serious damage, respect must be paid to bitcoin and other global financial investing tools that have seemingly managed to recover from the low slumps they were suffering from during the previous months. Bitcoin, for example, lost nearly 70 percent of its value from one month to the next. The currency was trading for well over $10,000 in February, but had fallen to the high $3,000 range by the time March rolled in.
Now, the currency has managed to regain most of what it has lost and has remained above $9,000 since early May of this year. The stock markets have also shown signs of serious recovery, while gold has shot up from $1,300 to just under $1,800.
What the present situation shows us, however, is that despite Japan’s odd and controversial history when it comes to cryptocurrencies, people have not lost faith in the country’s digital dealings. Why controversial? Well, four words come to mind: Mt. Gox and Coincheck.
Japan, despite being a huge haven for cryptocurrency activity, has been under hot water for some time given that it is home to some of the largest cryptocurrency thefts in modern history. The first, Mt. Gox, took place in February of 2014. More than $400 million in BTC holdings disappeared from one night to the next, and for the most part, much of that money has never been recovered or reimbursed to the people who lost out.
Some Shakiness to Its History
The second major hack was Coincheck. This one occurred roughly four years later in January of 2018. The exchange lost more than half-a-billion in assorted crypto funds and has earned the title of largest crypto hack in the short, yet significant history of the digital asset space. This hack ultimately led to the Financial Services Agency (FSA) getting involved in the process of regulating crypto exchanges.
The organization sent many letters to cryptocurrency trading platforms situated within Japan, telling them to get their act together. Any that refused or didn’t step up risked being shut down permanently.