A group of cryptocurrency exchanges in Japan have established an industry association that aims to regain public trust by imposing self-regulations and stricter security.
Sixteen exchanges are currently registered with Japan’s financial watchdog, the Financial Services Agency (FSA), according to a report from Japanese news outlet Asahi Shimbun. It is these exchanges that have launched the Japanese Cryptocurrency Exchange Association that is aiming to boost customer protection and internal controls. Some of the exchanges part of the association include bitFlyer, SBI Virtual Currency and GMO Coin.
According to the report, Taizen Okuyama, president of Money Partners Co., who is to serve as chair, said that the goal is to dispel customers’ anxieties and achieve the sound development of the market, adding:
We will firmly take measures for (computer) security and in-house management. We will also immediately coordinate trading rules and decide on what advertisement content is appropriate and what information we should disclose.
The formation of the association follows the hack at Tokyo-based exchange Coincheck, at the end of January, which saw the loss of $530 million worth of XEM, the token for the NEM platform. As one of the 16 exchanges that had yet to receive registration with the FSA, but was permitted to operate pending approval, the country’s financial watchdog has applied a firmer hand to how exchanges operate.
Earlier this month, it was reported that Coincheck was acquired by Japanese online brokerage Monex Group in an attempt to regain public trust.
Yuzo Kano, president of bitFlyer Inc. and a vice chairman of the association, added:
As financial service operators, we will increase our awareness. We will aim to take security measures that are stricter than before.
The association is planning to become a self-regulated organisation that is supported by law. It will create rules for members regarding customer protection and in-house management. It will also establish penalties against companies that damage public trust in the industry.
Okuyama added:
We want to create circumstances in which we can give to deemed exchanges. The development of our entire industry is important.
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