cryptovest.com
Tokyo-based trading platform Coincheck, the target of one of the largest hacks to date in the crypto industry, has received official approval by Japanese financial authorities to operate as a virtual currency exchange, parent company Monex Group said in a press release. The registration has been granted by the Kanto Financial Bureau and obliges Coincheck to follow various rules, including mandatory anti-money laundering procedures and a ban on anonymous virtual coins.
The approval is in force from January 11 and means that Coincheck has improved its systems after the hack that siphoned off $530 million worth of NEM (XEM) tokens last January. The incident forced Japan’s Financial Services Agency (FSA) to toughen applications rules.
Monex Group said:
“Complying with the “Registration Process for Cryptocurrency Exchange” which was publicized on October 24, 2018 by the Financial Services Agency of Japan, Coincheck has given a full explanation to the agency on the firm’s business descriptions, plans, and basic philosophy on risk management, as well as on the development of the firm’s governance with concrete internal controls and customer protection in mind.”
The registration obliges Coincheck to introduce mandatory know-your-customer (KYC) procedures and a system of multiple passwords for money transfers. Also, the exchange is not allowed to offer anonymous virtual coins, among them Monero (XMR) and Dash (DASH), as criminals use those assets to cover their illegal activities, according to the FSA.
Coincheck must store the assets of its clients only in offline devices (cold storage) and manage customers’ money separately from its own accounts. The company’s structure must split the responsibilities of shareholders and operating teams.
Following the Mt.Gox fiasco in April 2017, Japan introduced a regulatory regime that allows only registered companies to offer crypto trading services. Exchange already operating at that time, including Coincheck, were allowed to work on a provisional basis but had to apply for a permit with the financial office in their area of registration.
