Japan’s cryptocurrency trading scene is set to gain a self-regulatory body that will be working on improving investor safety in the sector.
According to a Nikkei Asian Review report, two trade organisations, representing 16 Japanese crypto exchanges, on Thursday reached an agreement to form a new organisation in April that will work with the country’s Financial Services Agency (FSA) to establish investor safety standards. The new body will also set guidelines for initial coin offerings (ICOs), the fundraising mechanism that allows companies to issue and sell their own digital tokens.
The goal is to "bring the entire cryptocurrency sector to bear on self-regulation", Taizen Okuyama, who will serve as chairman of the new organisation, said on Friday, as quoted by Nikkei Asian Review. Okuyama is president of forex trading platform operator Money Partners Group and chairman of the Japan Cryptocurrency Business Association, one of the two groups that will form the new organisation next month. The other group, called Japan Blockchain Association, is led by Yuzo Kano, the chief executive officer of cryptocurrency exchange bitFlyer. Kano is set to become vice chairman of the new group.
The move is also meant to bolster investor confidence in the wake of a cyber-attack that led to the theft of over $500 million worth of NEM tokens from local crypto exchange Coincheck in January. If approved by the government as an independent regulator, the group will have the ability to determine which virtual currencies can be traded on the nation’s crypto exchanges.