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Media Reports Binance Exchange Ordered to Cease Operations in Japan, Binance CEO Denies

Thu, 03/22/2018 - 19:30
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David Dinkins
Mainstream media outlets worldwide are reporting that the major cryptocurrency exchange Binance has been asked by Japan’s FSA to cease operations.
Media Reports Binance Exchange Ordered to Cease Operations in Japan, Binance CEO Denies
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A local news outlet, Nikkei, has reported that cryptocurrency exchange Binance was ordered to cease operations in Japan following its unauthorized expansion into the country. Japan’s Financial Services Authority (FSA) is the regulator that oversees the nation’s licensing program for cryptocurrency exchanges. Following a half billion dollar theft from Japan-based exchange Coincheck earlier this year, the FSA has reportedly been cracking down on crypto exchanges.

Shortly after Nikkei ran its story, Binance CEO Zhao Changpeng denied the rumors, tweeting:

Nikkei showed irresponsible journalism. We are in constructive dialogs with Japan FSA, and have not received any mandates. It does not make sense for JFSA to tell a newspaper before telling us, while we have an active dialog going on with them.

— CZ (not giving crypto away) (@cz_binance) 22 марта 2018 г.

Really big deal

Japan and Binance are both extremely important to the cryptocurrency sector. Japan presently has the largest Bitcoin trading volume in the world, with 56% of Bitcoin trades denominated in yen. Meanwhile, Binance is the largest cryptocurrency exchange in the world, by volume, with $1.7 bln in trades over the last 24 hours. Many of the top altcoins are heavily traded on Binance; the exchange is #5 by volume for Ethereum, #7 by volume for Litecoin, and #1 by volume for NEO.

Carrot and stick

Japan seems to be adopting a carrot-and-stick approach to dealing with Bitcoin. Last spring they made Bitcoin a legal payment method, but shortly thereafter began imposing licensing requirements on cryptocurrency exchanges. The strategy seems to be to offer an olive branch, then bring on the regulation. Put differently, Japan’s government seems to have some faith in cryptocurrency, but only so long as it remains within the nation’s existing regulatory framework. “Rogue” Bitcoiners must be shut down with alacrity.

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About the author

David Dinkins is a freelance writer who holds a Master of Arts in history from Louisiana Tech University and has extensive teaching experience both at LSU – Shreveport and University of Phoenix. He got involved with cryptocurrency in early 2014 working as part of the Dash Core Team and have served in the role of writer/editor (mostly editor) during that time. He has edited a huge number of documents for the Core Team, including the Evolution whitepaper, the PrivateSend whitepaper, and many of Evan Duffield’s communications with the Dash Community.