BY CNA team - October 1, 2018
JVCEA to impose ceiling on members’ online crypto holdings
The Japan Virtual Currency Exchange Association (JVCEA) plans to set a ceiling on members’ cryptocurrency holdings managed online in the wake of the Zaif exchange hack that saw US$62mil losses.
The Japan Times reported on Sept 30 that the ceiling is likely to be around 10% to 20% of customer deposits.
The media outlet quoted sources as saying that the JVCEA will revise the self-imposed rules drawn up in July and start implementing once the country’s financial regulator, the Financial Services Agency, has approved the rules as in accordance with the payment services law.
Zaif, owned by Osaka-based Tech Bureau, is suspected by industry experts of having placed too much of its crypto holdings online, making it vulnerable to attacks.
Typically, most exchange operators keep their holdings offline in cold wallets, with only a small portion kept online for transaction purposes.
Japanese regulators started cracking down on exchanges earlier in the year following the January hack of Coincheck that saw US$530mil worth of NEM tokens stolen.
The JVCEA was formed in April in response to the Coincheck hack and applied for formal recognition from the authorities in early July.