The officials in charge of financial regulation in Japan are urging international regulators to treat the crypto sector in the same way as traditional banking and to implement stronger regulations for it.
The Deputy DG of the Financial Services Agency"s Strategy Development and Management Bureau, Mamoru Yanase, stated that in order to have effective regulation, the same rules and oversight should be applied to both traditional institutions and crypto.
The statement from Japan"s financial regulatory agency comes after the collapse of FTX in November, which has prompted calls for regulatory action in the industry.
Unlike some officials in the United States, Yanase does not blame the technology of crypto for the issue but rather the lack of governance, weak internal controls, and absence of regulation and supervision. He is calling for regulators in the United States and Europe to enforce the same regulations for crypto exchanges as they do for banks and brokerages.
The recommendations for stricter regulations on crypto have been proposed through the Financial Stability Board, an international organisation responsible for regulating the digital asset industry.
Yanase emphasised the need for countries to enforce consumer protection measures for crypto exchanges and measures to prevent money laundering, as well as strong governance, internal controls, auditing and transparency for crypto brokerages.
Yanase also confirmed that the Japanese branch of FTX is set to resume withdrawals in February and that the agency has been closely working with FTX Japan to ensure that client assets are properly separated from the subsidiary.
The US court handling the case of FTX has approved the sale of FTX Japan and other subsidiaries of the company.
There were 41 potential buyers interested in purchasing the Japanese branch of the exchange. The CEO of Monex, Oki Matsumoto, has expressed interest in buying FTX Japan, stating that it would be beneficial for the company as it would reduce competition in the local market.
Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash
First Published: Jan 17, 2023, 20:58
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