• Japan wants global regulators to regulate the cryptocurrency market like banks.
• Japan is calling for strict rules in the crypto market following the collapse of FTX.
• Japanese regulators are focused on investor protection.
The cryptocurrency industry has been placed under the spotlight in recent months following a series of negative events that have battered the sector. In particular, the bankruptcy of FTX, which was once one of the largest cryptocurrency exchanges, has increased regulatory scrutiny in the sector. The events have highlighted the gaps and differences in the global cryptocurrency regulatory framework.
In response to this, Japan is now calling for global regulators to regulate the cryptocurrency market in the same way as banks. Mamoru Yanase, the deputy director-general of the Strategy Development and Management Bureau at the Financial Services Agency, has proposed a regulatory framework for banks in Japan. During an interview, Yanase noted that regulating crypto should be the same as regulating traditional financial institutions.
To ensure investor protection, the rules created by Japanese regulators are focused on safeguarding users of the FTX subsidiary in Japan. In a bid to restore confidence in the sector, users of the platform will be able to withdraw their funds from the platform as early as next month. Yanase also noted that the technology behind cryptocurrencies did not cause the recent scandal in the crypto industry. Instead, it was attributed to “loose governance, lack of transparency and other problems”.
Going forward, it is hoped that the regulatory framework proposed by Yanase will help to restore trust in the cryptocurrency industry and protect investors from potential losses. In addition, it is likely that other countries will start to adopt a similar approach when it comes to regulating the crypto market. This could pave the way for a more unified and effective regulatory environment in the near future.