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The Japan Financial Services Agency Recognized Some Violation On The Fisco Crypto Exchange

Neironix
July 1, 2019 12:00 AM
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The Japan Financial Services Agency Recognized Some Violation On The Fisco Crypto Exchange

On the 21st of June, the Japan financial regulator (the Financial Services Agency (FSA)) published a regulation on the official website, ordering to improve Fisco cryptocurrency exchange internal operations.

Moreover, it was revealed after verification that it was possible to launder money and transfer it to the terrorist organization addresses with the help of Fisco, because 'one could select the 'other' option and open an account without any additional data' in the section, where users entered identification information. However, the FSA didn't provide any specific information.

Until the 22nd of July, 2019, Fisco’s leadership must provide a plan to improve the company operations, that will describe all the points for transforming the activity of the platform. In addition, the crypto exchange should report to the FSA on the work done every month. The platform representatives haven't commented on the regulator check outcome yet.

Not Only Fisco Was Checked

The Fisco cryptocurrency exchange check began by the Japanese regulator in April, 2019. Then the FSA was studying the activity of the Huobi Japan crypto exchange department, in addition to Fisco. According to Reuters, the choice of the platforms to identify compliance with the law was probably made because of the new status of the exchanges.

Finally, the largest cryptocurrency exchange (Huobi), registered in Singapore in June, 2018, closed down the department in Japan for some legislative reasons, which aren't still clear. The exchange managed to return to the Japanese market through the purchase of a local licensed BitTrade crypto-exchange in half a year, in January. That's why the regulator started to inspect the entire Huobi Japan AML system.

The Fisco platform bought the previously existing Japanese crypto exchange (Zaif), which was hacked and robbed in the amount of about $60 million in autumn, 2018.

The New Law Submission

These cryptocurrency exchange checks, based in Japan, are held as a part of the new draft law, regulating cryptocurrency and digital assets activity. The House of Representatives of the country officially approved the Law on Financial Settlements and the Law on Financial Instruments and Exchanges, directly related to the crypto platform functioning, in May, 2019.

These laws legally protect users, help to regulate crypto assets trading, and improve exchange security standards. The draft law will come into force in April, 2020.