Japan is introducing changes to the regulatory framework regarding crypto trading, Nikkei Asian Review writes. The amendments to Japan’s financial instruments and payment services laws were approved last week by the Japanese Cabinet. They will come into effect in April 2020.
There are two major changes that will affect the crypto industry. The amended law will impose limits—similar to those foreign exchanges adopt—to cap margin trading at two to four times initial deposits.
Moreover, all crypto exchanges responsible for margin trading will need to register with the government within an 18-month period after the new regulations come into effect. According to Nikkei Asian Review, in order to protect investors, the new regulations require crypto exchange operators to be monitored to a similar degree as securities traders.
The changes are expected to protect investors from scams and Ponzi schemes. It will also give the Financial Services Agency the necessary tools to deal with unregistered operators. Currently, for instance, LastRoots and Rakuten Wallet are operating even though they have not yet received necessary approvals.