Japan’s cryptocurrency exchange is under pressure from regulators to strengthen censorship

nBankruptcy comment: The stingy of a new currency of over 500 million U.S. dollars by Japan’s Encrypted Currency Exchange Coincheck prompted the Japanese finance minister to require the financial department to carry out on-site inspections of domestic exchanges as soon as possible, forcing the exchange to step up cybersecurity and consumer protection measures. Japan’s finance minister said that there will be a balance between innovation and regulation. However, it is clear that previous government agencies’ efforts to master exchange information did not receive good results and the number of exchange-related experts was not enough. Therefore, the record-breaking hacker attack will prompt The government further strengthened regulatory measures.n
nTranslation: Annie_Xun
After hundreds of millions of dollars of crypto currency exchange Coincheck were reportedly stolen, Japanese regulators will step up industry reviews and conduct on-site inspections in the next few days.n
Japanese financial news Nikkei reported that regulators of the Financial Services Agency (FSA) in Japan will inspect several crypto-currency exchange operators in China this week. Reported that the on-site inspection is to force the exchange to adopt stronger cyber-security measures, more secure consumer protection measures initiatives.n
Last month it was reported that Coincheck confirmed that the $ 530 million New Money Order (XEM) was stolen by hackers, replacing Mt Gox as the largest cryptocurrency hacker in history.n
Coincheck is one of Japan’s 32 cryptocurrencies, but it is not part of the 16 registered operating agencies that the FSA supervises. After the Japanese law recognizes Bitcoin as a legal payment method, the new law also requires that the new cryptocurrency operating agency be registered with the FSA. But because Coincheck operations began before the introduction of laws and regulations, so get the exemption.n
After the hacker attacks, Coincheck announced that it would pay some 260,000 new money holders for the victimization. The FSA has verified this statement during a subsequent site inspection.n
The attack prompted Japan’s finance minister to ask the FSA to better regulate the cryptocurrency exchange and prevent consumer losses. Last week’s finance minister Taro Aso said that “we will be judging the trade-off between promoting innovation and protecting users of cryptocurrencies.”n
FSA has started on-site inspections of multiple exchanges. Other exchanges may use loose stock standards. Nikkei News reported that several exchanges provided “vague details” when asked to provide information on customer asset management, corporate governance, and security systems used. It is estimated that in the absence of regulation, more than one of the 16 exchanges was found to be unsafe to manage assets.n
Insufficient numbers of experts hired in the cryptocurrency exchange, particularly internal audit and cybersecurity experts, will prompt the FSA to take disciplinary action on exchanges that still do not have strong security measures.n

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