Popular cryptocurrency exchange, Coinbase, has revealed plans to expand its territory to Japan and is increasingly confident of receiving approval from Japan’s Financial Services Agency (FSA), amidst tighter security measures and license strategies.
Coinbase, based in San Francisco, is the largest and most valuable crypto exchange in the United States. Confident of operating an exchange in the Asian region, the company has welcomed increased scrutiny over security measures.
Japan’s FSA Approval
For Coinbase to operate in Japan, it has to be licensed by Japan’s FSA after its registration has been approved. According to Mike Lempres, Coinbase’s chief policy officer, in his interview with Nikkei Asian Review, the company is quite rest assured that it would receive necessary approval come 2019.
The process is not as fast and effortless as it used to, because of tighter security scrutiny from the Japanese Government towards exchanges. Lempres agreed that the Japanese government is more focused on security than anything else, following the barrage of hacks that infiltrated a number of exchanges in Japan in this year alone. The massive loss of Coincheck in about $500 million cryptocurrency tokens became the push that the FSA needed to tighten security and increase the standards and requirements that must be met by any exchange. This also led to a rigorous licensing process, resulting in many exchanges getting suspended, while the FSA cracked down on the others.
Lempres believes the increased scrutiny is good and especially beneficial to Coinbase as it serves provides an easy edge over its Japnese competitors. He also expressed optimism on the Japanese market, as he expects the Asian crypto space to make a rebound soon, and regain the lucrative appeal it was known for. He stated that:
“Japan has been an active large market from the very beginning, and has proved resilient as it bounces back from several bad experiences.”
Coinbase would hope to set security standards in the country with its unique way of storing and protecting client data and funds. According to Lempres, dozens of workers and employees are dedicated to the exchange’s security alone.
Coinbase’s special electromagnetic signal blocking tents is a trustworthy process that ensures only 1 percent of assets are stored in fully insured hot wallets, while the larger chunk of the funds, approximately 99 percent, is stored offline to ensure first-class security.