Japan’s FSA registers steep rise in enquiries about cryptocurrencies in Q1 2018
The number of enquiries the Japanese regulator received in the first three months of 2018 reached 3,559, marking a threefold rise from the preceding quarter.
Japan’s Financial Services Agency (FSA) has just confirmed that virtual currencies spark many questions among investors. According to the latest numbers provided by the regulator, the FSA’s Counseling Office for Financial Services Users received a total of 3,559 enquiries about virtual currencies in the first three months of 2018. The number is about three times higher than the 1,141 such enquiries received in the quarter to the end of December 2017.
About 36% of these consultations represented general inquiries and questions, the FSA explained, whereas 23% concerned transactions and individual contracts.
The trend of rising volumes of such enquiries has been noted since last year. In the quarter to the end of September 2017, for instance, the FSA got a total of 685 investor enquiries about virtual currencies. This was more than 26% higher than in the quarter to June 30, 2017.
The data is revealed as the Japanese regulators have taken administrative measures against a number of cryptocurrency firms. The latest one to get a business improvement order is Everybody’s Bitcoin Inc. The administrative sanctions are imposed following on an on-site inspection conducted by the FSA. The check concerned the risk management system of the company. The inspection has detected a series of non-compliance issues, including problems with keeping statutory books, insufficient provision of information to clients, AML issues, lack of control over system risks, as well as problems with internal audits.
As per the business improvement order, the company has to ensure appropriate and reliable business operations via:
- the establishment of a business management system;
- the establishment of a management system to combat money laundering and terrorism financing;
- the implementation of bookkeeping management system;
- the establishment of a management system related to user protection measures;
- the creation of a risk management system and an outsourcing management system.
Today, the FSA also provided data about the investment product enquiries received in the quarter to the end of March 2018. The number of such enquiries was 2,211, down from 2,466 in the preceding quarter. Questions about Forex services and products accounted for 14% of the total.
There were 133 fraudulent investment solicitation issues, of which 91 involved damage.
