Japan’s financial regulator plans to tame cryptocurrency speculations by tightening noose
Coincheck, one of the largest cryptocurrency exchanges in Japan, has witnessed purportedly the biggest ever theft of digital currencies in January this year.
In the wake of such an incident, the country’s financial regulator — Financial Services Agency — is planning to adopt stricter regulations to curb speculations over bitcoin and other cryptocurrencies, according to a Japan Times report.
Japan in April 2017, in a bid to safeguard users of digital currencies, revised the Payment Services Act and brought in a registration system for dealers who exchange cryptocurrencies with yen and other fiat currencies. It allowed for the further adoption of cryptocurrencies for payments.
But on the flipside, speculative investment spiked due to a sudden increase in their value, prompting the Financial Services Agency to make regulations in response.
In December 2017, Bitcoin saw a sharp rise from below 200,000 yen to over 2 million yen ($17,700) though it was for a brief period before it started plunging. At the time of writing, Bitcoin fell 11.4 percent against US dollar to trade at $6314, which roughly translates to 700,670 yen.
In 2017, transactions using five major cryptocurrencies accounted for 69 trillion yen, i.e. approximately 20 times the previous year, in Japan. The number of crypto users raised to 3.5 million in the island nation. However, most of these transactions were carried out for price gains, and not as an alternative to fiat currency.
“Young users who had previously no connection (with cryptocurrencies) have increased at a breathless pace,” a senior official of a major exchange operator told Japan Times.
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