Two of Japan’s cryptocurrency industry groups are reportedly planning to join to create a self-regulating body to safeguard investors following the Coincheck hack, according to sources.
A report from CNBC suggests that the Japan Blockchain Association and the Japan Cryptocurrency Business Association are expected to join together as early as April.
According to the Japan Cryptocurrency Business Association nothing has been decided yet.
The potential creation of a self-regulating body follows the hack at Japanese cryptocurrency exchange Coincheck last month. After suspending services to the exchange, the platform revealed that $530 million worth of NEM had been stolen, making it the biggest theft of its kind. As a result, Coincheck froze withdrawals services as it worked at resolving the issue.
Following the hack, the country’s financial watchdog, the Financial Services Agency (FSA) ordered the exchange to submit a report on how the hack had happened, the measures in place for customer support, and how it would prevent future hacks. This report was submitted on the 13th February. The agency will review the report and is expected to determine whether Coincheck should be given a license to operate legally. Prior to the hack it was allowed to function without a license.
The cryptocurrency exchange did vow to reimburse 260,000 of its customers holding coins, amounting to 46 billion yen ($431 million).
In latest developments a lawsuit was filed against Coincheck yesterday from a group of investors who want the exchange to resume its withdrawal services, according to Japan Today. The seven traders filed the initial lawsuit at the Tokyo District Court and are seeking the reimbursement of frozen assets worth 19.5 million yen ($182,910).
A second lawsuit against Coincheck from investors is expected to be filed on the 27th February.
Since the hack, the exchange has resumed yen withdrawals, which saw 40.1 billion yen ($373 million) being withdrawn on Tuesday. It has yet to restart cryptocurrency withdrawals, leaving many investors unable to take advantage of low prices in the market elsewhere.
Unlike China, Japan has taken a more favourable approach to digital currencies, making bitcoin a legal form of payment back in April.