Japanese Financial Regulator Suspends Two Crypto Exchanges

According to the order, FSHO and Eternal Link exchanges stop all operations related to virtual currency until June 7 and June 5 respectively
09 April 2018   408

The Kanto Local Finance Bureau of Japan's Ministry of Finance has published a new report on April 6, describing the Administrative Punishment for Financial Institutions and the administrative penalties. The Japanese financial regulator was investigating the activity of the exchanges, from March, and it finally announced its decision to suspend two cryptocurrency exchanges: Eternal Link and FSHO, which did not properly require customers to provide information such as purposes of trades.

According to the order, FSHO exchange stops all operations related to virtual currency from April 8 until June 7. Moreover, during the period from April 6, to June 5, all operations related to the virtual currency exchange business should be stopped by Eternal Link exchange.

There are several measures which are required from the exchanges to unsure that they are reliable:

  • Execution of confirmation at the time of trading on trading and execution of notification of suspicious transactions
  • Effective management system including money laundering and terrorist financing including review of business model
  • Secure management of user information
  • Risk management system
  • Proper implementation of legal book preparation and preservation

Moreover, according to the report, both cryptocurrecny exchanges did not implement procedures around reporting suspicious transactions to the Financial Service Authority.

Coinbase to Issue New Statement

As reported, company says it was wrong about SEC approval of acquisitions of Keystone Capital Corp., Venovate Marketplace Inc. and Digital Wealth LLC
18 July 2018   107

Vice President of Communications of Coinbase Rachel Horwitz denied the information that the company received approval from the Securities and Exchange Commission of the United States for a deal to buy brokerage companies. This is reported by Bloomberg.

It is not correct to say that the SEC and FINRA approved Coinbase’s purchase of Keystone because SEC was not involved in the approval process. The SEC’s approval is not required for the change of control application. Coinbase has discussed aspects of its proposed operations, including the acquisition of the Keystone Entity, on an informal basis with several members of SEC staff.
 

Rachel Horwitz

Vice President of Communications, Coinbase

On Monday, a spokesman for Coinbase said that the company received permission from the SEC and the Agency for Regulation of Financial Institutions (FINRA) to purchase Keystone Capital Corp., Venovate Marketplace Inc. and Digital Wealth LLC.

However, despite the refutation from Rachel Horwitz, Coinbase still intends to obtain a license to carry out brokerage activities.