Japanese Regulator Warns 5 Unregistered Crypto Exchanges

 Japanese regulator issues alerts to 5 unregistered cryptocurrency exchanges. Japan's financial authority, the Financial Services Agency (FSA), accused five cryptocurrency exchanges of operating without registration and sent them warning letters. Bitcastle LLC, Bitget Limited, Bybit Fintech Limited, Kucoin, and MEXC Global are the five cryptocurrency exchanges.

Japanese Regulator Warns 5 Unregistered Crypto Exchanges

Japanese Regulator Warns Unregistered Crypto Exchanges

The Financial Services Agency (FSA), Japan's financial regulator, reported on November 29 that it had issued warning letters to five cryptocurrency exchanges that it accused of operating without registration. The five cryptocurrency exchanges are: Bitcastle LLC, Bitget Limited, Bybit Fintech Limited, Kucoin, and MEXC Global.

According to a Coinpost investigation, cryptocurrency exchanges aimed at Japanese people must register with either the FSA or a financial agency. The regulator stated that it cannot supervise unregistered cryptocurrency exchange platforms and hence cannot verify if customer assets are adequately segregated.

Unregistered Crypto Exchanges in Japan

The FSA stated that this lack of control may prevent authorities from assisting unhappy users in the event of a dispute or unforeseen events. The commission also warned that Japanese residents who use these unregistered exchanges may not be eligible for asset protection or compensation under Japanese law.

By sending the warning letters, Japanese regulators join their French and Hong Kong counterparts in targeting illegal cryptocurrency exchange platforms. France's authority went even farther, advising inhabitants to exercise caution while interacting with one such platform. In Hong Kong, the Securities and Futures Commission has threatened legal action against firms operating unlawfully in the region.

The FSA's statement comes as Japan strives to establish itself as a leader in the Web3 space. In media reports, Yuichiro Tamaki, head of the Democratic Party for the People, urged for tax and regulatory reforms for cryptocurrency holdings. According to Bitcoin.com News, Tamaki's party has suggested a separate 20% tax on cryptocurrency holdings.

As of the moment, no one of the five exchanges had released a statement addressing the FSA's warning letters.