Two More Japanese Exchanges Halt Their Operations in the Wake of Coincheck
- A total of five exchanges have withdrawn their applications for licensure and shut down operations in Japan.

Tokyo Gateway and Mr. Exchange (based in Fukuoka) have become the latest two exchange to halt their operations as the result of the Japanese Financial Service Agency’s increasing enforcement of virtual currency laws. The FSA has tightened its grip on cryptocurrency-related activity within the country following the $532 million Coincheck hack earlier this year. Both will be returning customer funds before closure is official.
According to a report by Nikkei, the two exchanges withdrew their applications for licensure under the Japanese Virtual Currency Act, along with three other exchanges: Raimu, bitExpress, and Bit Station.
No official statements have been given by either exchange.
A growing list of closures
On March 8, Bit Station became one of two exchanges that the FSA ordered to suspend service for a 30-day period; at the same time, the agency issued business improvement orders to five other exchanges - Mr. Exchange and Tokyo Gateway were among them.
Bit Station was reportedly targeted by the FSA after it was revealed that a senior official at the exchange had allegedly routed deposits of digital currency for his own use; FSHO’s operations were halted after the FSA determined that the exchange had failed to properly train employees and install an appropriate trade-monitoring system.
Nikkei reported that more exchanges are expected to withdraw their applications for licensure because of inability to meet the FSA’s requirements. The FSA has reportedly given fallen exchanges an opportunity to withdraw their applications before they are “[ordered] to do so.”
Crypto Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority (FCA), the US’ Securities and Exchange Commission (SEC), Australian Security and Investment Commission (ASIC), and the Cyprus Securities and Exchange Commission (CySEC) are the most widely dealt with authorities in the FX industry.In its most basic sense, regulators help ensure the filing of reports and transmission of data to help police and monitor activity by brokers. Regulators also serve as a countermeasure against market abuse and malpractice by brokers. Brokers adhering to a list of mandated rules are authorized to provide investment activities in a given jurisdiction. By extension, many unauthorized or unregulated entities will also seek to market their services illegally or function as a clone of a regulated operation.Regulators are essential in snuffing out these scam operations as they prevent significant risks for investors.In terms of reporting, brokers are also required to regularly file reports about their clients’ positions to the relevant regulatory authorities. The most-recent regulatory push in the aftermath of the Great Financial Crisis of 2008 has delivered a material shift in the regulatory reporting landscape.Brokers typically outsource the reporting to other companies which are connecting the trade repositories used by regulators to the broker’s systems and are handling this crucial element of compliance.Beyond FX, regulators help reconcile all matters of oversight and are watchdogs for each industry. With ever-changing information and protocols, regulators are always working to promote fairer and more transparent business practices from brokers or exchanges. Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority (FCA), the US’ Securities and Exchange Commission (SEC), Australian Security and Investment Commission (ASIC), and the Cyprus Securities and Exchange Commission (CySEC) are the most widely dealt with authorities in the FX industry.In its most basic sense, regulators help ensure the filing of reports and transmission of data to help police and monitor activity by brokers. Regulators also serve as a countermeasure against market abuse and malpractice by brokers. Brokers adhering to a list of mandated rules are authorized to provide investment activities in a given jurisdiction. By extension, many unauthorized or unregulated entities will also seek to market their services illegally or function as a clone of a regulated operation.Regulators are essential in snuffing out these scam operations as they prevent significant risks for investors.In terms of reporting, brokers are also required to regularly file reports about their clients’ positions to the relevant regulatory authorities. The most-recent regulatory push in the aftermath of the Great Financial Crisis of 2008 has delivered a material shift in the regulatory reporting landscape.Brokers typically outsource the reporting to other companies which are connecting the trade repositories used by regulators to the broker’s systems and are handling this crucial element of compliance.Beyond FX, regulators help reconcile all matters of oversight and are watchdogs for each industry. With ever-changing information and protocols, regulators are always working to promote fairer and more transparent business practices from brokers or exchanges. Read this Term - a ‘necessary evil’
Cryptocurrency exchanges were originally required to apply for licensure starting in April of 2017, when the Virtual Currency Act was passed. Sixteen exchanges were granted licenses, while another sixteen were allowed to continue their operations while their applications were under review.
Following the Coincheck hack, however, unlicensed exchange have been scrutinized more heavily by the FSA. The agency launched a series of on-site inspections for crypto exchanges in early February.
Tokyo Gateway and Mr. Exchange (based in Fukuoka) have become the latest two exchange to halt their operations as the result of the Japanese Financial Service Agency’s increasing enforcement of virtual currency laws. The FSA has tightened its grip on cryptocurrency-related activity within the country following the $532 million Coincheck hack earlier this year. Both will be returning customer funds before closure is official.
According to a report by Nikkei, the two exchanges withdrew their applications for licensure under the Japanese Virtual Currency Act, along with three other exchanges: Raimu, bitExpress, and Bit Station.
No official statements have been given by either exchange.
A growing list of closures
On March 8, Bit Station became one of two exchanges that the FSA ordered to suspend service for a 30-day period; at the same time, the agency issued business improvement orders to five other exchanges - Mr. Exchange and Tokyo Gateway were among them.
Bit Station was reportedly targeted by the FSA after it was revealed that a senior official at the exchange had allegedly routed deposits of digital currency for his own use; FSHO’s operations were halted after the FSA determined that the exchange had failed to properly train employees and install an appropriate trade-monitoring system.
Nikkei reported that more exchanges are expected to withdraw their applications for licensure because of inability to meet the FSA’s requirements. The FSA has reportedly given fallen exchanges an opportunity to withdraw their applications before they are “[ordered] to do so.”
Crypto Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority (FCA), the US’ Securities and Exchange Commission (SEC), Australian Security and Investment Commission (ASIC), and the Cyprus Securities and Exchange Commission (CySEC) are the most widely dealt with authorities in the FX industry.In its most basic sense, regulators help ensure the filing of reports and transmission of data to help police and monitor activity by brokers. Regulators also serve as a countermeasure against market abuse and malpractice by brokers. Brokers adhering to a list of mandated rules are authorized to provide investment activities in a given jurisdiction. By extension, many unauthorized or unregulated entities will also seek to market their services illegally or function as a clone of a regulated operation.Regulators are essential in snuffing out these scam operations as they prevent significant risks for investors.In terms of reporting, brokers are also required to regularly file reports about their clients’ positions to the relevant regulatory authorities. The most-recent regulatory push in the aftermath of the Great Financial Crisis of 2008 has delivered a material shift in the regulatory reporting landscape.Brokers typically outsource the reporting to other companies which are connecting the trade repositories used by regulators to the broker’s systems and are handling this crucial element of compliance.Beyond FX, regulators help reconcile all matters of oversight and are watchdogs for each industry. With ever-changing information and protocols, regulators are always working to promote fairer and more transparent business practices from brokers or exchanges. Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority (FCA), the US’ Securities and Exchange Commission (SEC), Australian Security and Investment Commission (ASIC), and the Cyprus Securities and Exchange Commission (CySEC) are the most widely dealt with authorities in the FX industry.In its most basic sense, regulators help ensure the filing of reports and transmission of data to help police and monitor activity by brokers. Regulators also serve as a countermeasure against market abuse and malpractice by brokers. Brokers adhering to a list of mandated rules are authorized to provide investment activities in a given jurisdiction. By extension, many unauthorized or unregulated entities will also seek to market their services illegally or function as a clone of a regulated operation.Regulators are essential in snuffing out these scam operations as they prevent significant risks for investors.In terms of reporting, brokers are also required to regularly file reports about their clients’ positions to the relevant regulatory authorities. The most-recent regulatory push in the aftermath of the Great Financial Crisis of 2008 has delivered a material shift in the regulatory reporting landscape.Brokers typically outsource the reporting to other companies which are connecting the trade repositories used by regulators to the broker’s systems and are handling this crucial element of compliance.Beyond FX, regulators help reconcile all matters of oversight and are watchdogs for each industry. With ever-changing information and protocols, regulators are always working to promote fairer and more transparent business practices from brokers or exchanges. Read this Term - a ‘necessary evil’
Cryptocurrency exchanges were originally required to apply for licensure starting in April of 2017, when the Virtual Currency Act was passed. Sixteen exchanges were granted licenses, while another sixteen were allowed to continue their operations while their applications were under review.
Following the Coincheck hack, however, unlicensed exchange have been scrutinized more heavily by the FSA. The agency launched a series of on-site inspections for crypto exchanges in early February.