Financial Services Agency of Japan will allegedly bring in new rules related to cold crypto wallets for storing cryptocurrencies and digital assets at cryptocurrency exchanges. The development was first reported by Reuters on April 17.
Reuters, citing a source familiar with the matter, reports that Japan’s financial regulator will supposedly necessitate crypto exchanges to toughen internal supervision of cold crypto wallets. It is to be noted that cold wallets are devices for storing virtual currency which is not connected to the Internet.
By implementing the new regulation, the Financial Services Agency ostensibly addresses the problems of ensuring the security of digital currencies and other risks for the country since it aims to enhance the fintech industry to kindle economic expansion.
The Financial Services Agency heard arguments for no longer classifying bitcoin as a currency, earlier this month. During a plenary session at the Forty-first General Assembly of the Financial Council and the twenty-ninth Financial Division Meeting, Professor Iwashita Goto of Kyoto University argued that bitcoin had become something further than a means of transacting due to its borderless characteristics, which have led it to emerge all over the world in its 10-year history.
Furthermore, the Financial Services Agency approved the 2nd crypto exchange to begin operations under new regulations, in the month of March. The Financial Services Agency started issuing licenses to new virtual currency exchanges looking to serve the Japanese market. It is to be noted that in the past 2 years several events took place in the world of crypto. One of those events was the half-billion-dollar hack of local crypto exchange Coincheck in January 2018. The licensing scheme by FSA, which has a long waiting list, is seen as a reaction to the aforementioned events.