Japan’s two major cryptocurrency organizations will merge and form a new self-regulating body, the Japan Cryptocurrency Business Association (JCBA) and Japan Blockchain Association (JBA) said on March 2. The move comes amid deepening discussions about stronger regulations, and was triggered by Japanese cryptocurrency exchange Coincheck Inc.’s loss of massive amounts of NEM coins in late January.
The agreement on forming the new body was made by 16 cryptocurrency exchanges that have completed registration with the Financial Services Agency (FSA). However, the new body will not include exchanges such as Coincheck, whose applications are pending. Currently, details are unclear regarding the new body, such as its name, location and time of establishment, but the aim is to make it a body with legal backing. Companies aiming to complete registration with the FSA will be able to join the organization in the future.
The aim behind establishing the new organization is to strengthen self-regulation of Japan’s cryptocurrency business. The new organization will merge the major players in the cryptocurrency business that had been split before the Coincheck incident.
More major companies in Japan are going to get involved in the cryptocurrency business. Megabanks Mitsubishi UFJ Financial Group, Inc. (MUFG) and Mizuho Financial Group, Inc. are developing their own cryptocurrencies, respectively MUFG Coin and J-Coin, with the latter to be pegged to the Japanese yen.
LINE, a social media platform used by many Japanese, is also expanding into the cryptocurrency business, and Mercari, a flea market app popular in the Japanese domestic market, has also announced its intention to participate. Currently, there is said to be 100 companies on the FSA waiting list for assessment of eligibility to become an exchange.
Expectations are for the new organization to become a positive factor that improves transparency in the business at a time when the cryptocurrency business in Japan is showing signs of taking off.