Date
16 October 2018
Japan's financial watchdog has issued business improvement orders to cryptocurrency exchanges after it found flaws in anti-money laundering systems and controls. Photo: Bloomberg
Japan's financial watchdog has issued business improvement orders to cryptocurrency exchanges after it found flaws in anti-money laundering systems and controls. Photo: Bloomberg

Japan FSA orders improvements at crypto exchanges

Japan’s Financial Services Agency (FSA) has ordered the nation’s cryptocurrency exchanges to carry out improvements on measures aimed at curbing money laundering.

The financial regulator slapped six exchanges with business improvement orders after it found flaws in their anti-money laundering systems and controls during on-site inspections, Reuters reports.

Following the order, bitFlyer, one of Japan’s biggest crypto exchanges, said it will voluntarily halt the creation of new customer accounts as it makes efforts to shore up its systems.

Others targeted by the FSA included well-known exchanges Quione and Bitbank.

The FSA has cracked down on cryptocurrency exchanges since the US$530 million theft of digital money from Coincheck, one of Japan’s biggest, earlier this year. 

Since the daring heist, the financial watchdog has rejected applications to run exchanges, and ordered others to cease or improve business over weaknesses in customer protection.

Due to chair the G20 in 2020, Japan hopes to take a global lead on the combating money laundering at cryptocurrency exchanges, and is pushing for adoption of new binding rules by 2019, Reuters noted.

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