In Japan, new laws regulating crypt currencies - the Payment Services Act (PSA) and the Financial Instruments and Exchanges Act (FIEA) - will come into force on May 1 this year.
The laws were passed by the Japanese Parliament last year, and were due to come into effect on April 1. However, due to unplanned delays, implementation of the new regulation was postponed until May 1.
Since there are no official laws regulating cryptov currencies in Japan, amending the existing acts is the only way for digital assets to have any legal status in the country. Therefore, quite a few amendments have been made to the PSA, including changes in basic terminology and stricter rules for cryptocurrency custodial services.
In addition, cryptocurrency exchanges operating in Japan would have to separate user funds from their own funds. In other words, they will need to find a third-party company responsible for storing user funds using "reliable methods" such as cold wallets.
If clients insist on using hot wallets, the exchange will have to store an appropriate amount of funds to compensate users for their losses in the event of a break-in.
Changes in FIEA introduce the concept of token transfer in order to regulate primary token offerings (ICOs) and token stock sales (STOs). Trading in cryptographic derivatives will also fall under FIEA, which is the most popular form of trading in Japan.
Recall that in March, the Japanese Financial Services Agency (FSA) announced the launch of the Blockchain Governance Initiative Network (BGIN), which will promote "sustainable development of the blockchain industry.
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