Japan wants to give the cryptocurrency industry a chance but in a regulated fashion. Japan’s Financial Services Agency (FSA) is planning to introduce a framework to regulate unregistered investment firms which deal in cryptocurrencies, subject to the Financial Instruments and Exchange Act. Specifically, the Japanese regulators are trying to address a loophole that allows unregistered firms to accept funds in cryptocurrencies. There has been no timeline set for the regulatory framework.
Japanese news reports have cited various scams being perpetrated through the current legal provisions. The infamous ‘Sener’ scam is a case in point which duped people of more than 8.3 billion yen ($77 million). While the people behind this scam have been arrested by the police, the regulators want to ensure that such incidents do not occur in the future.
Clearly, the Japanse regulators are taking a proactive approach to governance by attacking the problem at its roots, unlike India which blames the asset class itself.