Following a recent cyber heist of $530 million in Japan that has once again shaken the world of cryptocurrency, trading was halted at two cryptocurrency exchanges forcefully by the authorities in Japan as a part of its crack down on cryptocurrency trade.
Bitstation and FSHO are the two exchanges that were ordered to stop all transactions in cryptocurrencies by Japan’s Financial Services Agency on Thursday for at least a month. the allegations against FSHO is that the exchange had failed to adequately protect the interest of the customers while customer funds were used for made use for personal transactions by a Bitstation executive, alleged the Japanese regulator.
There has so far been no comment from either of the exchanges.
There are five other cryptocurrency exchanges that were ordered to strengthen the internal management of the exchanges and implement some other enhancement to their functioning by the regulator in addition to imposing “administrative penalties” on those five exchanges.
Coincheck exchange where a cyber hacking resulted in the loss of about $530 million from its user accounts last January is also included in the list of the other five exchanges.
That cyber theft has been identified to the biggest ever heist of cryptocurrency and exceeds the about $400 million that was stolen after a cyber theft from another cryptocurrency exchange based in Japan – the Mt Gox back in 2014.
Its own funds would be used by Coincheck tp to reimburse the loss to its users because of the hacking, the exchange has promised.
In order to enhance the protection of its customers, it would undertake “a drastic review of internal and business management”, said the exchange following the regulatory order on Thursday.
In recent years, there has been huge growth in interest among commoners and traders alike in Japan towards virtual currencies which has transformed Japan into one of the largest cryptocurrency market in the world and the Japanese regulators have bene attempting to find out ways to efficiently manage the increased interest in cryptocurrency.
And this is a challenge that many other governments in the world are facing.
In the past one year, restrictions and regulations on cryptocurrency trading and exchanges have been taken up in countries like China and South Korea to efficiently regulate the volatile cryptocurrency world. The measures have sought to make trading and business transactions in cryptocurrencies more transparent.
Fears of strict government regulations in India had forced stoppage of trading at two exchanges in India which is a comparatively small and yet a growing place for crypto currencies.
Investors there have become nervous by the enhanced government and authority interventions.
There was a fall of over 9 per cent in the value of bitcoin which went below $10,000 on Wednesday. This happened after investors in the U.S. were warned by the US Securities and Exchange Commission on unregistered platforms.
(Adapted from Money.cnn.com)