Japan’s FSA to Grant Crypto Exchange License to Coincheck

[Ozark]

Japan’s Financial Services Agency might grant Coincheck a crypto exchange license, a source familiar with the matter revealed.

Japan’s Financial Services Agency (FSA) is about to approve Coincheck’s application for a cryptocurrency exchange license, Nikkei reported on Wednesday. However, it seems that the information is based on internal sources given that no official announced has been published yet. An official release is expected to be presented to the public by the end of this year. Coincheck was in the spotlight back in January when $511 million worth of NEM was stolen by hackers, which had a massive influence on FSA’s behavior in relation to local crypto exchange providers.

When the hack happened, Coincheck was the largest crypto exchange operator in Japan. The company had to halt its trading services. Meanwhile, Monex Group showed interest in Coincheck and even acquired it at the beginning of April. Based on the latest reports, the FSA seems to be satisfied with Coincheck’s improved customer protection and the general situation with the exchange.

In February, the FSA raided Coincheck’s offices and soon released two business improvement orders that focused on anti-money laundering (AML) and customer protection issues. The regulator discovered that Coincheck was not ready to guarantee full compliance with AML and customer protection rules.

However, now that Monex’s subsidiary has taken concrete measures to change its method of cryptocurrency listings, the FSA might be open to granting a crypto exchange license. Coincheck returned the equivalent of about $410 million in compensation to clients affected by the January hack.

If the FSA decides to provide Coincheck with an exchange license, it is expected that the regulator would retake its approval process. Currently, more than 200 entities are waiting for similar licenses.

Before granting any license, the FSA will review business plans, anti-hacking approaches, and methods used against other misconduct. In September, we reported that Japan’s financial regulator tightened its registration rules for crypto exchange operators.

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