Japan to Regulate Cryptocurrency Wallets
November 17, 2018 3:31 pm
Japan’s cryptocurrency users may have to reveal their identities as the country’s top financial watchdog is preparing a law for it. On Monday, The Financial Service Agency (FSA) has announced its plan to regulate cryptocurrency wallet providers. The decision was made during a cryptocurrency study group meeting after concerns over money laundering and terrorist financing were raised. The agency wants to protect crypto wallet users from cyber attacks and infrastructure failures.
The agency did not reveal any details on when the new regulation would appear. It also included how it may provide the wallet services according to the predefined standards. The current laws draw a clear line between businesses that help in purchasing and selling of assets, managing and transferring assets for customers.
Blockchain.info, Bitcoin wallet providers might not be facilitating trades, but to Japan regulators, they assist in the management and transfer cryptocurrencies. As the act concerns wallet companies working in Japan, users could practice regulatory arbitrage by downloading wallets from elsewhere – using VPNs.
A crypto wallet, however, remains a self-opened, self-regulated bank account. Cryptocurrency users do not require any third party custodianship to protect their holdings. They hold private wallet keys to prove full-ownership.
Recently Japanese police arrested 16 criminals over cryptojacking. According to the report by Asahi Shimbun, these criminals used to install malware on victim’s computers in order to mine digital currency unlawfully. They were also running their own site to spread the crypto mining malware, including the Coinhive program, that mines Monero (XMR).