The Huobi token is the first international exchange token approved by the Japanese regulators. after the Financial Services Agency (FSA) approved HT as a compatible crypto asset that can be traded in the world’s second largest digital asset market from May.
Only 25 additional tokens have been approved in the FSA whitelist. Japan is tightening regulations to better define crypto assets.
Last year, the Japanese House of Representatives revised the Payment Services Act (PSA) and the Exchange and Financial Instruments Act (FIEA) with effect from May 1.
Law firm Morrison Foerster LLP reports this Some of the changes will strengthen protection for investors in crypto assets. A recent post on the company’s blog stated that custodians who are not involved in selling, buying, and brokering the sale of crypto assets are also subject to the new PSA rules.
Additional provisions for the exchange of cryptocurrencies
Cryptoactive derivatives are also tested according to the FIEA regulationand related companies must register to function in the Japanese cryptocurrency industry. Crypto asset derivative transactions that are processed through the delivery of crypto assets previously regulated by the PSA are also part of the FIEA mandate.
Providers who have crypto assets in customer custody must register as an exchange provider after May 1st.
New requirements under the PSA
Among the requirements relating to client assets proposed in the PSA amendment, protection with respect to custody of users deserves special mention, as these deposits must be kept in a trust account. Exchanges are required to hold digital assets in offline wallets or equivalent.
The regulation also provides that part of the assets held in an online wallet may be 5% or less of the added value of the customer’s assets held in custody.
Cointelegraph reported on April 1 that a report by Tokyo-based law firm So Sato found this Strict regulations in Japan are likely to benefit new players in the long term.