Japan to regulate cryptocurrency wallet services
Despite the self-regulatory status that cryptocurrency industry received in Japan, the authorities still seem to want to regulate crypto wallets.
The Japanese Financial Services Agency (FSA) recently announced that they’re working on the regulatory framework for cryptocurrency wallet services.
Since they don’t technically provide trading services to customers, they’re still operating in a “gray” area and, according to the FSA lawmakers, they should be therefore regulated.
However, the regulations would not involve all crypto wallets, only the custodial ones, which are operated by third parties. The regulations will be designed with one main goal to satisfy international standards and laws when it comes to anti-money laundering and anti-terrorism financing, and also police some of the risks associated with the possible hacks or thefts. It is anticipated that the regulators will then most likely require to have “Know Your Customer” policies in place.
At this point, it’s not clear when the policies will be implemented and enforced. However, it was made clear that any wallet service provider that doesn’t adhere to the rules will be subject to strict fines from the government.
The reason Japan decided to implement additional regulations to crypto wallets is pretty much straightforward – the country has already suffered from several major crypto hacks, losing over $540 million during only the first six months of this year.