Japan Financial Services Agency Grants Cryptocurrency Exchange Permit to Coincheck Platform

Last Modified:12 May 2020 11:36:53
Japan Financial Services Agency Grants Cryptocurrency Exchange Permit to Coincheck Platform

Based on a report published by Cointelegraph Japan news website on January 11, quoting an official communique, Japan Financial Services Agency (FSA) granted a complete cryptocurrency exchange permit to Coincheck platform in order to continue its operations there. This achievement came a year after hackers had stolen half a billion dollars in an attack.

Coincheck is a cryptocurrency exchange platform and Bitcoin wallet, which was founded in 2014. The services Coincheck exchange offers include exchanging fiat currency (a currency without intrinsic value, its value is determined only based on government order and regulation), Bitcoin, or Ethereum. Coincheck is a member of the Japan Blockchain association and one of the main developers of the cryptocurrency usage standards for Japan government.

The blockchain is a distributed and encrypted database. Therefore, no one is able to manipulate the history of transactions, and this history is transparently available to users. One of the known applications of Blockchain are cryptocurrencies which are founded on this infrastructure. This technology provides security in cryptocurrencies. Cryptocurrency is an encrypted currency which is also known as electronic money, virtual money, or currency crypto. The first cryptocurrency based on Blockchain that was introduced to the market was Bitcoin.

The coincheck platform which was attacked in January 2018 and lost $530 million worth of altcoin tokens (altcoins are cryptocurrencies released into the market after Bitcoin and consider themselves as a good alternative for Bitcoin), has now joined the community of licensed cryptocurrency exchanges in Japan market.

Altcoins are cryptocurrencies that were introduced after Bitcoin; Many altcoins were built based on the principles of Bitcoin and were released through a change in the mining process or the manner of altering transactions.

This was an important and prominent step for Monex exchange and online broker which bought Coincheck in April for the nominal amount of $33.5 million.

Monex group made some changes in Coincheck exchange; during these organizational changes, Yusuke Otsuka, its chief operating officer, was ousted and replaced with Toshihiko Katsuya, a Monex employee. Moreover, Koichiro Wada, founder, and CEO of Coincheck was degraded from his post.

Additionally, Coincheck removed cryptocurrencies such as Dash (a kind of cryptocurrency used to be known as dark coin or X coin), ZCash (a kind of cryptocurrency with more security compared to other cryptocurrencies like Bitcoin), and Monero (a kind of cryptocurrency which is implementable on operating systems like Linux, Windows, macOS, Android, and FreeBSD) from its list of cryptocurrencies.

The reason was the risk of preventing the firm from compliance with anti-money laundering regulations.

According to a report published on January 11 by Monex group, Coincheck has been specifically registered at the Kanto Financial Bureau of Japan.

Monex group is a dependent financial services company in Tokyo, Japan which was founded on April 5, 1999.

During this time, developers gradually returned function to users and organizations and managed the stolen coins.

Last year, Japan sought to deploy a legal and official initiative due to the disturbing condition of security setups in exchanges, in order to increase the security of exchanges. Despite tighter constraints, some small-scale attacks are still happening; so much so that the Japanese cryptocurrency exchange Zaif was attacked in September and lost about $20 million.

Also, Cointelegraph news website reported on Friday about Japan government investigation in cryptocurrency exchange security in South Korea, less than one-third of platforms in this area had satisfactory performance.