Cryptocurrency Regulation Among the Hot Seat Topics for 2019 G20 Summit to be held in Japan
This year’s G20 summit set to be held in Osaka, Japan will be the first to highlight cryptocurrencies among the main agendas.
According to the information provided by Sankei’s news source, Japan led by its Prime minister, Abe Shinzo, will address digital asset economy from the point of regulation. This involves reviewing the laid regulations as per Fund Settlement Act and the Financial Instruments and Exchange Law.
The summit will give attention to issues pertaining security of the digital currency ecosystem following rampant hacks since the bullish run in 2017. One case that affected the industry in particular was Coincheck’s hack where $532 million NEM was stolen. This was followed by a swift response from the Japanese government and have been pushing for more regulations especially in coin trading ever since.
Japan’s regulator, Financial Services Agency, took measures such as requirements for cold wallet for its crypto users. Initially, coin traders and hodlers stored their digital assets in hot wallets that were vulnerable owing to their interface accessibility via the internet. Today, crypto users in Japan store their digital currencies offline reducing their probability of being hacked.
Furthermore, Japan plans to propose tighter constraints when it comes to leverage in trading cryptocurrencies. This is already taking shape for Japan based crypto exchanges with most providing a leverage of up to 4x while their counterparts have as much as 100x. A good example is BitMEX, the leading platform in cryptocurrency derivatives and altcoin exchange.
This soon to be proposed bill will also affect crypto trading dynamics if it goes through. Nikkei, the news outlet, stated that Japan will propose a ban on adverts designed to increase traffic for speculation in crypto trades.
It was also noted by Japan’s Deputy Prime Minister, Aso Taro, during a press conference that cryptocurrencies would no longer be referred to as virtual currencies if the bill is passed.
The reason given was to clearly distinguish digital assets from existing currencies like the Euro and Yen. He added that cryptocurrencies will be categorized under ‘cryptographic assets’ as per their fundamentals.
The G-20 summit scheduled for June will be Japan’s first and is set to convey the globe’s leaders from respective continents. They include; United States, United Kingdom, Turkey, South Korea, South Africa, Saudi Arabia, Russia, Mexico, Japan, Italy, Indonesia, India, Germany, France, China and Canada.