The Japanese cryptocurrency industry’s efforts to police their own business activities was given the greenlight by Japan’s Financial Services Agency (FSA) on Wednesday, after the agency announced that it has granted the Japan Virtual Currency Exchange Association self-regulatory status.
According to Reuters, one FSA official acknowledged that the industry’s rapid growth and innovation would make it difficult for any regulatory body to properly keep pace with needed rule changes and compliance issues. That official said, “It’s a very fast moving industry. It’s better for experts to make rules in a timely manner than bureaucrats do.”
With its newly recognized self-regulatory status, the crypto industry association will be allowed to establish rules for the industry and implement sanctions when necessary to ensure compliance. That will enable the JVCEA to design better protections for customers, tackle issues like money laundering, and implement consistent standards to guide exchange operations within the country.
The self-regulating association’s rules are reportedly tighter than Japan’s existing regulatory requirements, which should help to build public confidence in the industry.
The FSA also chose to issue new guidelines on Wednesday for companies that want to operate crypto exchanges within Japan. The country now has 16 FSA-approved exchanges in operation. Reuters reports that 160 additional organizations and entities have shown interest in applying to operate their own exchanges.