Coincheck fallout results in the closure of more Japanese Cryptocurrency exchanges.

After the hacking of $532 million worth of NEM (this January) from the crypto exchange Coinhack, Japanese regulators tightened the oversight of the sector. A law that took effect last April required the cryptocurrency exchange to register with the FSA. Sixteen exchanges were allowed to operate while there application was under review.

According to Nikkei a leading Japanese financial newspaper

                  “The FSA began on-site inspections of all 16 unregistered operators with pending applications. These exchange operators are required to have data security and other systems on par with those at the 16 registered exchanges. But the FSA’s probes have so far found problems with corporate governance and internal controls. Some operators see little prospect of meeting the agency’s standards.”

Agencies standards are proving quite expensive for these exchanges to compete besides the recent fall in the crypto space has resulted in lower trading volume and hence reduced profits.

 

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