Japanese cryptocurrency exchanges will be forced to limit leverage for margin trading in digital currencies. If earlier the maximum limit for such instruments was x25, now the leverage should not exceed the size of the initial deposit more than 4 times. This is stated in the amendments to the law "On financial instruments and stock exchanges", approved by the Japanese Council of Ministers, the Nikkei reports.
It is assumed that the new rules will come into force in April 2020. Within 18 months from now, all cryptoexchanges that provide margin trading services will be required to register. Otherwise, they will lose their license and will not be able to continue operations in the country.
The adopted amendments are designed to protect investors from the activities of financial pyramids.
On March 14, the Canadian Securities Authority (CSA) and the Investment Industry Regulatory Organization (IIROC) proposed to prohibit crypto exchanges to increase leverage for margin traders, as well as to restrict the possibility of opening short positions.
Experts explained their recommendations by the “potentially manipulative or misleading” nature of these operations.
In February the Maltese cryptobirth OKEx increased the size of leverage from 3x to 5x.