Recently Japan has responded to crypto challenges with tough measures to not only take control of questionable business practices but to build confidence in a market that has seen two shockingly large heists that cost investors almost 1 billion US dollars.
In addition to the 16 member self-regulating body that has been formed by exchanges in Japan, the FSA, Financial Services Agency, the chief regulator of all things financial in Japan, has held some entities accountable and even penalized several that had demonstrated lax internal rules. Japan is now focused on building an industry that is best in class and will earn the public`s trust in the future.
Last week, the agency (FSA) issued a warning to Hong Kong-based Binance for operating in the country without a license. Japanese authorities recognized bitcoin as legal tender last April and has been working to ensure that all exchanges are well documented and have properly registered with the government. Of course, this is in line with recent meetings and G20 and is expected to be the core topic in the G20`s follow-up meeting in July 2018.
As expected, short-term price action in cryptocurrencies is lower, as harsh penalties and new rules are articulated by the FSA. Some of these coins have traded lower for 2 months now and are off their highs by 20 to 70 percent. However, we see this as a natural and very necessary repricing as in the long-term, these new rules imposed by Japan and other countries will bring confidence and a wider range to investors who will, in the end participate in safe, well protected and fair markets.
Japan and Switzerland both see bitcoin as legal tender. And note that four of the 10 biggest coin offerings have been based in Switzerland according to one report. The Swiss Financial Market Supervisory Authority has built structure in the form of clear guidelines for ICOs, Initial Coin Offerings. More on Japan and Switzerland in follow-up articles and audio-visual presentations.