The two most prominent cryptocurrency industry groups in Japan may be planning a merger as they intend to form a self-regulating body for cryptocurrencies in the country.
In a bid to strengthen cryptocurrency safety in the country, The Japan Cryptocurrency Business Association and her counterpart Japan Blockchain Association are expected to come together as a unified body. Both parties are currently in negotiations and the merger could happen as early as April according to a CNBC source.
Matters being discussed in the negotiations include the leadership of the new organization; the report suggests that they may appoint the heads of both groups as the Chairman and Vice Chairman of the new body. The Japan Cryptocurrency Business Association responded saying that nothing has been decided yet.
This move to beef up cryptocurrency security comes in the light of the Coincheck hack that happened last month. Last month, hackers stole $530 million from the Japanese cryptocurrency exchange in what has been described as one of the biggest heists of digital currency. The Tokyo-based company resumed Yen withdrawals last week and has submitted a report on the hack and how it will prevent a reoccurrence in the future to Japan’s Financial Services Agency (FSA).
Japan has enjoyed a boom in cryptocurrency activities in Asia since neighbors China and South Korea took tough stances on the cryptocurrency transactions. Unlike in China where exchanges are banned, Japan opted to regulate the cryptocurrency industry instead. The Coincheck hack has now called the countries decision into question. The exchange was approved in September 2017.
If the merger goes through, Japan cryptocurrency industry will join South Korea in the path of Self-regulation. Following a clampdown on exchanges by the South Korean government due to volatility and lack of transparency, industry players formed a group and agreed on some self-regulating measures. Measures adopted included strict user identification.
We are yet to see the extent of self-regulatory measures and how they will relate with government policies. We would just have to sit back and see what the negotiations turn up.
Solomon Sunny is the market reporter for Smartereum, one of the global leaders in Ethereum, blockchain and currency news. He produces technical price updates on digital currencies and writes recent developments about blockchain.