The Japanese financial regulator has targeted another cryptocurrency exchange for improvement after an on-site inspection revealed inadequate standards. The exchange must comply and submit a written report next month.
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Another Exchange Punished
The Japanese Financial Services Agency (FSA) has issued another “administrative punishment order” to a cryptocurrency exchange. On Wednesday, the Tokyo-based Minnano Bitcoin received a business improvement order from the agency. The exchange’s website says its English name is “Everybody’s Bitcoin Inc.”
The order follows an on-site inspection by the FSA after the exchange submitted its system risk management report to the agency. The exchange is a “deemed dealer” of cryptocurrencies, meaning it is allowed to operate while its application is being reviewed by the agency.
Based on the report and the inspection, the FSA found problems with the exchange’s “compliance with laws and regulations and proper operation of the business.” For example, the agency found that the exchange was “not performing appropriate verification at the internal audit in addition to the inadequate management and management system.” The agency further detailed:
It [the exchange] also has the problem of preventing money laundering and terrorist financing, preparing and preserving statutory books, providing appropriate information to users, [and] effective control over system risks and outsourcers.
Minnano Bitcoin has three cryptocurrencies listed on its website: bitcoin (BTC), ether (ETH), and bitcoin cash (BCH).
The exchange is a wholly owned subsidiary of the publicly listed Traders Holdings Co. Ltd. (JASDAQ:8704), which engages in foreign exchange and securities trading in Japan. In June of last year, the exchange signed a business alliance agreement with Debit Inc regarding a fund settlement service using cryptocurrency.
The content of FSA’s Order
“The following measures
