Japan is expected to implement anti-money laundering regulations aimed at crypto exchanges
By modifying several current financial sector legislation, Japan is intensifying its efforts to restrict the use of cryptocurrencies to facilitate criminal activity through exchanges.
Nikkei reported on September 27 that Japanese officials are preparing to implement new remittance regulations that would prohibit criminal enterprises from utilizing cryptocurrency exchanges to launder money.
Revisions to the Act on the Prevention of the Transfer of Criminal Proceeds, mandating exchanges to communicate customer information across operators, are expected to become effective in the spring of 2019. Through the new regulation, the Japanese government intends to follow the money transactions of those involved in unlawful operations.
When transferring bitcoin to another exchange, the customer’s name and address are among the details that must be given. In addition to criminal sanctions, crypto exchanges that violate the legislation will be subject to administrative counselling and remedial actions.
It is anticipated that amendments to the legislation would be presented to the special Diet session scheduled for 3 October, when, if approved, cryptocurrencies will be included in money transfer regulations.
In addition, the legislation will target stablecoins after the Terra (LUNA) ecosystem breakdown. Under the proposed legislation, stablecoins will be required to register.
In addition, the laws are the result of a recommendation by the Financial Action Task Force (FATF), an international group responsible for overseeing anti-money laundering measures, that nations implement comparable regulations. In this line, the United States, Germany, and Singapore pass the legislation.
More ideas to regulate the crypto sector
In general, Japan has modified its regulatory position in preparation for the expansion of the cryptocurrency industry, with further legislation expected to be enacted in the coming months.
For example, the nation has suggested amending the Foreign Exchange and Foreign Trade Act to include stablecoins on the list of regulated assets. The regulation prohibits the use of stablecoins for transfers to sanctioned nations like North Korea and Russia.
In light of a rise in crypto laws, the government regards the industry as a crucial driver of economic growth. As reported by Finbold, Japan’s Financial Services Agency (FSA) has recommended a reduction in the corporate crypto tax in order to stimulate the economy.
Also Read: IMF Requests That The Global Financial Watchdog To Push Crypto Regulatory Efforts