The Japanese Financial Services Agency (FSA) ordered the country’s exchanges to reinforce measures to prevent money laundering and financial crimes, causing Bitcoin and other cryptocurrencies to fall in value. On June 23 Bitcoin decreased 7% to $ 6,159 after this fact, and until today June 29 has not recovered by quoting its value at $ 5,907.
The order of the FSA caused Bitflyer, the largest exchange in the country to suspend opening of new accounts pending when they have improved on the recommendation of the regulator. Speaking about the order, the company posted a statement on its website, which stated that:
“Our management and all employees are united in our understanding of how serious these issues are, as well as how serious we are in responding to them going forward”. “In order to maximize our efforts towards building a suitable service and improving on the issues identified, we have temporarily suspended account creation for new customers of our own volition”
The FSA had earlier issued similar order to five exchanges that it adjudged their security and anti money laundering preventive measures to be inadequate. The CEO of BKCM, Brian Kelly, said that these measures by FSA are necessary if cryptocurrencies were to emerge an important asset class.
Kelly said that these measures will affect the entry of new funds into the encrypted market. It will also affect the most capitalized currencies. The Bitcoin trade represents more than 60% of the total volume in Japan and the effect of the policy is felt among the main exchanges.
The coin has been hit by lack of new buyers as the market seems to have stagnated since the beginning of 2018. This is the result of massive selloffs linked to falling prices. The absence of new buyers is attributable to the fall in prices contrary to the expectations of many new entrants who saw Bitcoin as a path to quick wealth. Bitcoin and the coin market generally have lost more than 50 percent of their capitalization. The coin has dropped from its all-time-high of $20,000 and has been struggling to get traction since this year.
Japan has been in the forefront of regulatory activities after the country’s first exchange and then biggest exchange, Mt. Gox was hacked in 2014. The exchange hack spurred the country to introduce measures that have seen the country become a leader in cryptocurrency regulation. The level of adoption of cryptocurrencies in Japan is among the highest in the world. Regulators usually work with exchanges to ensure protection for investors.