One of the biggest problems that the cryptocurrency market dealt with over the last months is hacking. As for Japan, its Financial Services Agency (FSA) decided to make it harder for cryptocurrency exchanges to operate in the country. In fact, because of the new rules imposed by the regulators, Kraken even decided to move out of Japan.
$530 Million Hack
The FSA started to scrutinize the sector after the $530 million hack that happened to Tokyo-based cryptocurrency exchange CoinCheck in January. After the incident, the agency decided to scrutinize the exchanges and gave business improvement orders to six licensed crypto exchanges. And also, there were around five rejections for cryptocurrency license applications in June.
Now, Japan’s financial regulator is looking to expand its team. From 30 individuals screening the crypto exchange license applications, the FSA is looking to add 12 additional members to its team. Among mainstream companies that want to enter Japan’s crypto market include companies such as Yahoo, Rakuten, and LINE. Kiyota Sasaki has revealed that the “biggest problem” the agency currently faces is how it deals with new operators that are looking to get licensed.
The regulators are currently dealing with 160 new applications for companies looking to establish a licensed crypto exchange platform in Japan.
Large Crypto Market
There is a large crypto market in Japan. Japan already has around 3.5 million active crypto traders in the country. The annual trading in 2017 was at around $97 billion. Among the most popular cryptocurrencies include Bitcoin, Ethereum, Bitcoin Cash, and Litecoin.
Can we expect excessive regulations? Japan has been known for its welcoming approach to the industry. In fact, FSA’s new commissioner Toshihide Endo mentioned that “We have no intention to curb (the cryptocurrency sector) excessively. We would like to see it grow under appropriate regulation”.
Huobi Now Enters the Japanese Crypto Exchange Market
Huobi has recently acquired a major stage in BitTrade, a Japan-based crypto exchange company. Huobi is currently based in Singapore and was founded in China in 2013. It has been ranked among the top five crypto exchanges in the world. The company has been known for trading volume that has exceeded $1 trillion since it has been founded. Huobi has been reported to expand in Europe by having an office in London.
BitTrade, on the other hand, made certain milestones as well as a crypto exchange. It is among 16 licensed crypto exchanges in Japan. And also, it participated in self-regulating the industry right after the hacking incident.
Chris Lee, the Chief Financial Officer for Huobi believes that it can take advantage of BitTrade’s international network. He mentioned that “We strongly believe in the synergies we can create through continued investment into R&D, and compliance, backed by our world class security and local operations teams across the globe. Leveraging on BitTrade leadership team and its Japanese government-approved license, this is just the beginning as we look to grow BitTrade into the most dominant player in the Japanese cryptocurrency market”.
The owner of BitTrade, Eric Cheng has been known for his vast experience in international investments and crypto entrepreneurship.