The financial services Agency of Japan (FSA) on the results of audits of local kryptomere came to the conclusion that it is necessary to toughen requirements for new trading venues. It is reported by Cointelegraph.
In particular, the report refers to the need of more stringent requirements for cryptocurrency exchanges wishing to obtain a license to conduct operations. The FSA will carry out site inspection of such companies, and closely examine the efficiency of their business models. According to the Agency, currently “hundreds” of companies have pending applications.
The Agency also concluded that the development of the infrastructure of exchanges and the effectiveness of their internal control systems are lagging behind the rapid growth of transaction volume and dynamics of the market as a whole. According to FSA, the total value of digital assets, local exchanges reached 792,8 billion yen ($7.1 billion). In the last year this figure increased by 6 times. The number of staff in most marketplaces does not exceed 20 people. Thus, the average per employee have digital assets worth $3.3 billion yen ($29,7 million).
Also, the regulator has identified some of the problems associated with the peculiarities of the business models of exchanges, focusing on risk management and compliance, internal audit systems and corporate governance. The FSA also expressed concern at the lack of measures of anti-money laundering (AML).
ForkLog previously reported that because of the demands the FSA has suspended the registration of new users, a major Japanese exchange bitFlyer.