Japan’s Financial Services Agency (FSA) wants to strengthen its monitoring operations in the cryptocurrency space, which will require expanding the unit tasked with such supervision. The regulator is looking to add 12 members to that team to handle the fast pace growth in the crypto market, FSA policy director Kiyotaka Sasaki was cited as saying by Reuters.
Japan is among the most important markets in the cryptocurrency and blockchain space. Cryptocurrencies became a legal payment method in early 2017, and the FSA now grants special licenses to crypto exchanges that comply with the established rules.
On Wednesday, the regulator held the fifth study group meeting with government officials, trading platforms, lawyers, and academics, among others. During the event, the FSA said it intended to expand its crypto team, with Sasaki noting the agency currently has about 30 people responsible for monitoring crypto activities, including reviewing operators for a potential license. The team will expand to over 40 people in fiscal 2019.
After the meeting, the FSA presented a document that said it was reviewing 16 crypto exchange operators, while over 160 companies are ready to apply for an exchange license soon. Before getting a license, crypto exchange owners have to go through several instruction processes conducted by the FSA. Thus, 12 of the 16 companies withdrew their applications during these instruction sessions, while one operator was rejected by the agency. The rest of them, including Coincheck, are waiting for the final verdict.
In January of this year, Coincheck became the victim of probably the largest crypto theft so far, with about $600 million worth of NEM stolen by hackers. The incident prompted the FSA and Japanese authorities to adopt a more rigorous approach to crypto activities. The Coincheck hack was also the reason behind the first crypto study group meeting in April this year.