Japan’s financial watchdog is reportedly planning to conduct more on-site inspections of domestic cryptocurrency exchanges.
According to a report from Nikkei, the country’s Financial Services Agency (FSA) is looking to inspect several more cryptocurrency exchanges in the country starting as soon as this week, following its visits to Coincheck in the days after its recent major hack.
The plan comes as the agency seeks to push for stronger security procedures to be adopted by cryptocurrency exchanges in Japan in order to protect investors and to prevent such intrusions from reoccurring.
As reported previously, around $531 million-worth (at the time) of NEM tokens were stolen on Jan. 26 from the Coincheck exchange. That led to the FSA’s on-site inspection on Feb. 2 to gauge the platform’s security and financial ability to compensate victims, as it has promised.
The FSA has stated that it had warned the exchange about its security loopholes before the hack, which also explained why Coincheck has yet to obtain a formal approval from the agency.
In fact, Nikkei’s report further explained that, while the cryptocurrency exchange business is burgeoning in Japan amid wider market growth, many platforms have fallen behind in terms of security protections.
According to the report, among the total 32 cryptocurrency exchanges, Coincheck is currently one of the 16 platforms that are not formally registered with the FSA because the operation started before the cryptocurrency law went into effect last April in Japan.
Japanese law enforcement image via Shutterstock