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MAS Partners With Japan And Switzerland To Boost Digital Asset Regulation

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In a game-changing maneuver, the Monetary Authority of Singapore (MAS) is poised to lead the charge in crypto-centric collaboration with influential European and Japanese counterparts. This revelation, unveiled by the distinguished Chinese journalist Colin Wu on X, represents a major leap forward in digital assets.

According to a recent report, MAS is joining forces with the Financial Services Agency of Japan (FSA), the Swiss Financial Market Supervisory Authority (FINMA), and the United Kingdom’s Financial Conduct Authority (FCA). Together, they aim to spearhead joint digital asset pilots, specifically focusing on fixed income, foreign exchange, and asset management products.

This initiative stems from Singapore’s ongoing Project Guardian, a landmark venture launched in 2022. Project Guardian saw Singapore’s central bank team up with 15 financial institutions to conduct pilots on asset tokenization, showcasing the substantial potential for enhanced transaction efficiency.

MAS And Global Partners Advance Digital Finance

The consortium’s objectives include the initiation of pivotal policy and accounting dialogues, the identification of potential risks and legal voids related to digital assets, and the exploration of common standards for designing digital asset networks. Additionally, the group will delve into best practices and regulatory sandboxes, furthering education in the digital currency sector.

Leong Sing Chiong, the Deputy Managing Director of Markets and Development at MAS, emphasized the collaborative effort’s overarching goal to delve deeper into understanding the multifaceted landscape of digital asset innovation, with a keen focus on both its potential opportunities and inherent risks. This strategic endeavor reflects a dedicated commitment to advancing knowledge and expertise in this dynamic crypto ecosystem.

Singapore has steadfastly committed to aligning with international financial authorities within the digital currency domain. In a momentous feat that unfolded in September 2023, MAS triumphantly completed a collaborative examination encompassing cross-border trading and settlement of wholesale central bank digital currencies. 

This pioneering venture, executed in conjunction with the Bank for International Settlements and the central banks of France and Switzerland, not only revalidated Singapore’s standing as a frontrunner but also underscored its vanguard role in shaping the ever-evolving landscape of digital finance.

OKX Halts Services For Japanese Traders Amid Regulatory Tug-of-War: Report

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In a surprising development, OKX, the second largest offshore cryptocurrency exchange, has announced its decision to suspend services for residents of Japan. The move comes in response to what appears to be mounting regulatory pressure from Japan’s Financial Services Agency (FSA).

According to a report from Coinpost, a leading cryptocurrency news outlet, OKX’s app now displays a disheartening message: “Due to local laws in Japan, you cannot use OKX Exchange products.”

The decision follows a similar announcement made by Binance Global, another major player in the crypto exchange industry.

Binance revealed that it would cease its services for Japanese residents on November 30, 2023, as part of its plan to launch a dedicated platform designed explicitly for the Japanese market.

This move aims to comply with local regulations and establish a more substantial presence in Japan.

The report indicates that discontinuing the global version of the exchange for Japanese users is imminent. Users attempting to access the OKX app within Japan are met with the disheartening notification that reads, “OKX Exchange products cannot be used in Japan due to local laws and regulations.”

The situation has forced the exchange, which currently lacks a license in Japan, to respond to the demands of the Financial Services Agency.

Meanwhile, OKX’s Help Desk expressed sincere apologies for the inconvenience caused to its Japanese user base. They assured users that the issue is being actively addressed and updates will be provided as soon as possible.

However, the suspension of services by both OKX and Binance in Japan highlights the increasing focus of regulatory authorities on the crypto industry.

OKX’s Native Token OKX Price Analysis

OKB remains resilient despite recent news, showing promising signs with a 7.28% rise in the weekly chart, currently trading at $44.33, according to CoinMarketcap’s data.

OKB 1D graph coinmarketcap 1
Source: CoinMarketcap

Price predictions from a reputable source indicate a bullish trend in the long term, with a projected increase of $1.07 over the next 7 days, potentially reaching $45.40 by July 4th, 2023.

In the short term, a machine learning algorithm has identified a bullish trend for OKB. Consequently, investors can anticipate a slight increase in the coming hours. 

This positive trajectory suggests that OKB continues to garner confidence and interest within the market, despite the challenges faced by the exchange in suspending services for Japanese traders.

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Japanese Crypto Exchanges Seek Relaxation of Margin Trading Restrictions: Report

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In a bold move, Japanese cryptocurrency exchanges are striving to loosen the reins on margin trading, with plans to submit a proposal to the Japan Financial Services Agency (FSA) in the coming month. 

This endeavor seeks to enable retail investors to leverage their trades by four to ten times, a significant increase from the current maximum borrowing exposure.

According to the Japan Virtual & Crypto Assets Exchange Association, many industry insiders advocate for permitting retail investors to leverage their trades at higher ratios. 

Genki Oda, the association’s Vice Chairman, emphasized the potential benefits, stating that such reform could make Japan more appealing to crypto and blockchain companies, thereby encouraging more trading activities.

Oda revealed that the nation’s digital-asset exchanges are actively discussing a recommended leverage limit and are poised to present their proposal to the FSA in the near future. While Japan has made strides in easing certain crypto regulations related to token listing and taxation, it is generally known for its stringent regulatory environment. 

Notably, the Japanese branch of the failed exchange FTX managed to return funds to its clients earlier this year, a testament to Japan’s focus on investor protection.

Crypto Firms Must Present Convincing Reasons for Loosening Caps

The FSA remains cautious and insists that crypto firms must present compelling reasons as to how relaxing margin trading restrictions would align with the government’s objective of expanding blockchain-based industries. The agency, however, expressed its willingness to engage in discussions with digital-asset businesses on this matter.

Once boasting leverage ratios as high as 25 times, Japanese crypto platforms witnessed a significant decline in margin trading volumes, plummeting 75% by 2022 due to the FSA’s imposed limit of two times leverage. 

In comparison, digital-asset exchanges in other jurisdictions typically offer margin trading ratios between five and ten times initial deposits, with some platforms providing even more aggressive lending options.

Oda asserted that digital-asset volatility has decreased since 2020, and Japanese exchanges possess the necessary capabilities to help investors manage the risks associated with margin trading. Nonetheless, he anticipated that any relaxation of leverage rules would not occur before 2024.

Following the global crypto market crash in the previous year, regulators worldwide implemented stricter measures to address risky practices. While some jurisdictions like Hong Kong and Dubai aim to attract digital-asset firms, the United States has taken a more stringent approach.

In 2023, the top 100 cryptocurrencies experienced a rebound of 33%, albeit still recovering from the turbulence of 2022. The market has witnessed some institutional and individual investors exiting, leading to decreased liquidity and a subdued indicator of anticipated price fluctuations in Bitcoin.

As Japanese cryptocurrency exchanges strive for more flexible margin trading regulations, they face the challenge of convincing the FSA that such a move aligns with the government’s goals while safeguarding investors’ interests. 

However, the outcome of this initiative will significantly impact the landscape of crypto trading in Japan and potentially draw increased attention from global players.

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Binance Opens Up Doors To The Japanese Market With Acquisition Of SEBC

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Binance, the world’s leading crypto exchange, announced its acquisition of Sakura Exchange BitCoins (SEBC), a registered crypto exchange service provider, on November 30th. With this acquisition, the leading crypto exchange opens up its doors to the Japanese Market.

Along with its brokerage business, SEBC also provides its clients with consultancy services. The announcement post lists the 11 trading pairs that the Tokyo-based exchange now supports.

The global market for the world’s largest crypto exchange is expanding. The financial goliath’s quick rise was previously marked by the opening of the Binance door in New Zealand (in September).

The company believes that Asia’s marketplaces have tremendous potential, and it has considered a number of nations for future expansion. Acquisitions are a part of the development ambitions, and the company’s next targets are expansion in the Philippines and Turkey.

The firm received regulatory authorization to sell cryptocurrency services in France, Italy, Spain, Dubai, Abu Dhabi, and Bahrain as part of its worldwide expansion. However, “the acquisition of SEBC marks Binance’s first license in East Asia.”

Binance Re-Entry Into Japanese Market After Four Years

Binance last conducted business in Japan in 2018, the same year the FSA warned it for operating without a license. Binance received a similar notice for violating the registration regulations in 2021.

After four years, the world’s largest crypto exchange now has access to the Japanese market through the SEBC acquisition as a licensed company under the Japan Financial Services Agency (JFSA).

However, the transaction’s terms weren’t made public. The leading crypto exchange seeks to create a responsible global cryptocurrency ecosystem by providing Japanese-regulated services via SEBC.

Takeshi Chino, general manager of Binance Japan, said: 

The Japanese market will play a key role in the future of cryptocurrency adoption. As one of the world’s leading economies with a highly-developed tech ecosystem, it’s already poised for strong blockchain uptake. 

To build their combined exchange in a compliant manner for local customers, he continued, they will actively collaborate with authorities. They are eager to support Japan in taking the lead in the crypto industry.

“On top of our effort to prioritize user protection,” Hitomi Yamamoto, CEO of SEBC, stated that Binance’s robust compliance system would assist create a more compliant environment for consumers in Japan and will allow them to engage with essential services needed for crypto adoption.

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