Japan’s Financial Services Agency (FSA) has taken a firm stance against unregistered crypto exchanges operating in the country, requesting tech giants Apple and Google to block downloads of their apps from their respective app stores. This move marks the first time the FSA has made such a request, signaling a crackdown on exchanges that are not compliant with Japan’s regulatory framework.
The FSA specifically targeted exchanges like Bybit and MEXC Global, as well as three other overseas exchanges that have not been publicly named. Under Japan’s Payment Services Act, crypto exchanges must register with the FSA to operate legally in the country, ensuring adherence to anti-money laundering (AML) and investor protection laws.
The regulator has been ramping up efforts to enforce stricter regulations on crypto exchanges, with a focus on know-your-customer (KYC) and AML rules. Despite previous warnings, Bybit, MEXC Global, and other firms allegedly continued to allow Japanese residents to access their platforms, prompting the FSA to escalate its enforcement measures.
Japan has implemented stringent regulations on cryptocurrency following major hacks like Mt. Gox and Coincheck, which resulted in significant customer losses. Registered exchanges in Japan are required to segregate customer funds from company assets, maintain high-security standards, and undergo regular audits by the FSA.
The FSA’s request to Apple and Google underscores Japan’s commitment to regulatory compliance within the crypto sector. This move could push unregistered exchanges to either seek compliance or exit the Japanese market altogether. It also raises questions about the role of major tech companies in enforcing regulatory demands from governments.
Overall, Japan’s regulatory actions highlight the importance of compliance and investor protection in the crypto industry. By cracking down on unregistered exchanges, the FSA aims to create a safer and more transparent environment for cryptocurrency trading in the country.