Japanese Bitcoin Exchanges Planning Several Trading Restrictions: Report
The association of 16 government-approved bitcoin exchanges is reportedly working on imposing a number of trading restrictions. Jiji Press reported that there is a plan to impose trading limits for all users and additional restrictions for minors and the elderly. This follows recent reports of the association introducing margin trading limits as part of its self-regulatory rules.
Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space
Possible Trading Caps
According to Jiji Press news agency, the Japan Virtual Currency Exchange Association (Jvcea) is planning to set trading limits for its crypto exchange members.
The association is comprised of all of the 16 government-approved crypto exchanges in Japan. It was established in May in response to the hack of Coincheck in January.
“The association will decide on the issue soon,” sources told the news outlet Friday. It will then file with the country’s top financial regulator, the Financial Services Agency (FSA), for approval “to be recognized as a self-regulatory body under the payment services law,” the sources detailed.
“The planned rule is aimed at preventing cryptocurrency traders with relatively small assets from suffering heavy losses and facing difficulties with daily expenses,” the sources also added, noting:
The industry group plans to allow exchange operators to choose from two options: A blanket ceiling that is low enough for the safety of customers with limited assets or setting different limits for different customers based on their age, assets, investment experience and income levels.
Other Restrictions Being Considered
The association has been working on self-regulatory measures since its establishment. Last month, Nikkei reported that it is planning to set rules to prohibit insider trading and privacy coins.
The Jvcea self-regulatory rules were expected to be released last month. However, the announcement was delayed when the FSA issued business improvement orders to six of the association’s members, causing two vice presidents of the association to resign.
The trading limit report follows another report that the association is planning to limit margin trading, reducing leverage to 4 times. Currently, Japanese crypto exchanges offer as high as 25 times leverage.
According to the publication’s sources:
The group also plans to require minors to get permission from parents or other guardians before trading, prohibit margin trading in principle, and demand regular checks on the decision-making ability of elderly customers. It will also restrict large-lot orders as a measure against money laundering.
While multiple reports have surfaced regarding the association’s self-regulatory policies, the organization itself has not officially made any announcements.
Do you think Japanese exchanges should impose trading restrictions? Let us know in the comments section below.
Images courtesy of Shutterstock and the FSA.
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