Japan legalized digital currency in April 2017 by passing a law which recognized bitcoin as legal tender. After Chinese suppression of the digital market, Japan has become the leading bitcoin market.
The Japanese Financial Services Agency (FSA) recently recognized a total of eleven companies as registered cryptocurrency exchanges. Consequently, Japanese banks have also been considering introducing their own virtual currency, the J-coin.
With Japan becoming one of the largest protagonists of digital currency, the Japanese FSA have been publishing new financial administrative policies covering topics such as Initial Coin Offerings (ICOs). The agency aims to protect the users from fraudulent activities and other abuses, as well as alerting the public of any potential risks that could lead ICO investors to jeopardy.
In the first part of the document, the FSA talks about utilizing blockchain technology. Since it is not controlled by a single entity, it is quite secure. In fact, it was developed for the sole purpose of protecting the digital currency users. The FSA also plans on regulating exchanges and making them fraud resistant by creating a cyber-security system at each point of exchange. This would ensure that exchanges remained secure and would also counteract any abuse such as money laundering.
The agency also plans to keep track of trends of the digital market and will make sure that its users are provided with adequate information for performing their transactions. Moreover, the FSA also warned investors regarding the hazards of ICO. They explained that the two major risks involved in investing in an ICO were price fluctuations and fraud. The price of altcoins may rise and fall anytime. Additionally, investors must properly research companies launching an ICO to make sure that they have the proper documents, whitepapers, and are not fraudulent.
The FSA explained that they aim to guard the users against fraudulent ICOs. They are willing to work with other agencies and ministries to neutralize and eliminate any dishonest ICOs, in order to provide a safe and stable marketplace for the cryptocurrency investors.
Japanese FSA provides guidelines for investors
With Japan becoming one of the largest protagonists of digital currency, the Japanese FSA have been publishing new financial administrative policies covering topics such as Initial Coin Offerings (ICOs).
Published on Nov 20, 2017 13:47 By Danish Yasin