Japan's separate rules for crypto could be the answer
08 Jun 2018
This article first appeared in International Financial Law Review on 07 June 2018.
Coinbase has entered the Japanese cryptocurrency market after a six-year wait, one of only a handful of companies allowed to operate in the country.
The move comes at the same time the country’s regulator, the Japanese Financial Services Authority (JFSA), is keen to strengthen investor protection after the record-breaking hack on cryptocurrency exchange Coincheck in January and Mt. Gox’s bankruptcy in 2014. Tokyo-based exchange Mt. Gox filed for bankruptcy after almost 750,000 of its customers bitcoins, and 100,000 of the company’s own, were stolen in an online attack. Four years later, hackers made off with nearly $500 million in digital tokens from Coincheck.
George Morris, partner at Simmons & Simmons, said the Coincheck hack brings into focus whether regulation can fix problems. "Exchanges that operate under less regulation have actually not had problems of this kind," he said.
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