Financial Services Agency (FSA) Of Japan Strengthens The Selection Process For Cryptocurrency Exchange Beginners
The Financial Services Agency, a Japanese government agency and an integrated financial regulator responsible for overseeing banking, securities and exchange, and insurance sectors, has toughened its registration for cryptocurrency exchanges to see if they are conducting risk management correctly. Such registration processes are conducted in accordance with the revised law “On Payment Services”, which came into force in April 2017 to protect the users of cryptocurrencies.
According to the recent statements the state observer increased the number of questions asked when checking applications, to about 400 points. Currently, it obliges applicants to submit protocols of meetings of the Board of Directors to check whether there has been sufficient discussion on measures to maintain the financial condition of the company and ensure the security of its computer system.
The modernized and improved screening process as well constantly overviews the composition of the shareholders of the applicant company.
As a result of the inspection, the Financial Services Agency (FSA) on-site identified in-house internal controls on cryptocurrency exchanges, among them the lack of protocols of meetings of the Board of Directors.
More than 100 companies appeared to be interested in registering as operators of cryptocurrency exchanges. A more stringent process may cause some to give up, analysts say.