The Japanese regulator, the Financial Services Agency (FSA) has issued a business improvement order to the exchange operator Fisco, according to an article published in the magazine, Bitcoinmagazine attributed to Jimmy Aki. The regulator issued the order to the Fisco management team for several rules violations. Fisco is the operator of Zaif, a Japanese exchange that was hacked in September 2018. This hacking has put the exchange under a microscope since the exchange changed management in April of 2019.
The FSA has worked with Fisco and other exchanges to ensure tha they complied with customer protection and legal compliance standards. The FSA also found shortcomings in the exchange`s customer verificaton infrastructure, specifically when selecting information blocks on the website. Some of these exchanges will have to improve anti-money laundering (AML) and risk management systems. The exchange Fisco, was ordered by the FSA to upgrade its auditing, accounting and outsourcing.
Our Views: The Japanese cryptocurrency market is maturing in a very Japanese way. It is now seeing large institutions getting involved in this ecosystem, along with A.I. and other new technologies as Japan moves forward, with the support of government institutions, to develop new industries outside of the usual electronics and autos, areas where Japan has or in the case of autos, still has a strong position. Japan continues to expand its influence in investment in these areas as it sees challenges from China, South Korea, the US and the EU.