Less than a week after acquiring a major Japanese crypto-exchange, the chief executive at Monex is appealing to regulators to employ incumbent banking standards at cryptocurrency exchanges.
After its April 16 purchase of the Coincheck cryptocurrency exchange that was reported earlier this month, the CEO of online Japanese brokerage firm Monex closed out what must have been a very busy week by telling Reuters that regulators seeking to legitimatize cryptocurrency exchanges should consider employing well-established banking regulations in place of developing crypto-specific legal stipulations.
“Japan’s exchanges do both matching and custodial services,” said Oki Matsumoto, “To someone in the financial industry like myself, it’s common sense that regulations will get stricter.”
Matsumoto’s comments could have been spurred by a $500 million hack that afflicted Coincheck in late January.
Like many cryptocurrency exchanges, Coincheck holds customers’ digital assets in addition to connecting buyers with sellers in a “matching” process.
Generally speaking, an online brokerage like Monex has strictly enforced rules for separating assets and is required to keep customers’ cash and stocks at trusted third-party locations (e.g., trust banks). This is in stark contrast to the foggy and poorly defined regulatory stipulation requiring exchanges to, for example, keep individual and company assets separate from one another.
Regardless, the Coincheck acquisition is evidence that Monex is willing to overlook both regulatory uncertainty as well as negative publicity to gain an entry point into the cryptospace, which as of March had 3.5 million Japanese citizens trading cryptocurrencies.
Markets have favored the Monex gamble on the whole, with shares for the brokerage rising 66 percent since announcing interest in acquiring Coincheck.
Relatedly, Yahoo Japan’s Z Corporation recently acquired a 40 percent shareholding in bitARG Tokyo, a FSA licensed cryptocurrency exchange.
Japan’s Financial Services Agency has also expressed increased interest in distributed ledger technologies like blockchain.
Jordan Daniell is a full-time staff writer for ETHNews with a passionate interest in techno-social developments and cultural evolution. Jordan enjoys the outdoors, especially astronomy, and likes to play the bag pipes and explore southern California on foot in his spare time. Jordan lives in Los Angeles and holds value in Ether.
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