Japan’s largest cryptocurrency exchange Bitflyer has contested media reports that the Japanese financial regulator has deemed its user verification process to be insufficient. Nonetheless, the exchange admitted to being in talks with the authority and has implemented additional measures.
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Reports of Financial Regulator’s Concerns
The largest Japanese crypto exchange by volume, Bitflyer, has issued a statement in response to media reports that the Financial Services Agency (FSA) has asked the exchange to strengthen its user verification procedure after determining it to be insufficient.
Nihon Keizai Shimbun reported last week that, unlike many other exchanges in Japan, customers were able to trade cryptocurrencies at Bitflyer “even with insufficient identity verification.” According to Japanese law, customers must mail verification document to the exchange as part of the know-your-customer (KYC) requirements.
While “A normal dealer will take 1 to 3 weeks” from account opening to trading, the news outlet noted that trading within 24 hours is possible at Bitflyer. Since speculators often try to time the market and profit before the price drops, “exchange operators who can start trading earliest are attractive,” the publication explained.
Bitflyer quickly contested this report, claiming that “the contents reported are different from the facts,” adding:
The company has implemented measures such as money laundering and terrorist financing…and has been discussing with the authorities concerned.
The exchange clarified that its discussion with the FSA is healthy, emphasizing that “We are strengthening countermeasures as one of the most important management issues” throughout the company.
Recently, the FSA has been actively inspecting crypto exchanges, particularly those that have been allowed to operate while their applications are under review. Among the 16 fully licensed exchanges, only GMO Coin
