The Japanese Financial Services Agency (FSA) has announced that it received registration applications from 50 Bitcoin exchanges as of August 2017. The applications are being reviewed for compliance.
A report by the local newspaper Sankei Shimbun claimed that the agency has started their review on whether the exchanges dealing with virtual currencies like Bitcoin have implemented measures aimed at protecting their users.
State of the digital currencies in Japan
The government of Japan amended its fund settlement law in April 2017 to allow recognition of Bitcoin as a legal payment method. Many have credited that decision with Bitcoin’s extraordinary bull run this year.
With that approval, the FSA was required to ensure the registration of virtual currency exchanges in the country. Exchanges must be registered by the end of September.
Under the law, the FSA should ensure that the exchanges are compliant with the requirements before they can be officially registered. Among the requirements are the implementation of appropriate measures to guarantee the full protection of users. Additionally, exchanges are required to communicate with the FSA about the risk of financial losses due to such factors as price volatility.
The FSA also checks whether the assets of an exchange are clearly separated from its user deposits and ensures that a proper risk management system is established.
Japanese companies add Bitcoin exchanges in their service
Major companies in Japan are already adding Bitcoin exchanges to their service offerings. In March 2016, the publicly-traded conglomerate Remix Point Inc. launched its Bitcoin exchange called Bitpoint. Fisco Ltd., a Jasdaq-listed financial information provider, has introduced its Bitcoin exchange.
The other companies which set up exchanges include Internet major GMO, SBI Holdings, and the Money Partners Group.
The continued integration of Bitcoin into Japan’s economy almost certainly bodes well for its continued price appreciation.