It was a long pending wish of Coinbase to set up its feet in the crypto market operating in Japan. For one pretext or the other, the dream could not come to life until recently when the relevant authority dealing with crypto in Japan has granted permission to Coinbase for rendering crypto trade services in the country. But Coinbase’s crypto trade services would be limited to a total of 5 digital coins.
Finally, the moment has come for Coinbase when it has been able to see its dream coming to life.
Coinbase has had a long pending wish to set up its feet in Japan by extending its crypto trading arms. For the purposes of achieving these object, Coinbase had filed an application early on with the Finance Services Agency (FSA) of Japan. FSA is the relevant authority of Japan that deals with matters pertaining to digital currencies and assets. In addition, FSA is the exclusive authority that grants permissions to Virtual Assets Service Providers (VASPs) i.e. the crypto exchanges. Without the approval of FSA, no local or an international VASP is authorized to indulge in any crypto trading, buying, or even selling.
There are also certain pre-requisites which FSA requires any VASP to adopt before granting the license. For instance, Japan has voluntarily adopted international monetary standards like AML and CFT. Therefore, every VASP is duty-bound to give an undertaking and agree in writing that it will comply with these standards to its fullest.
However, with regard to Coinbase’s application, the matter of the issuance of the permission was kept pending by FSA. FSA has recently decided to grant permission to Coinbase to initiate the process of rendering crypto services in Japan. The permission so announced has been duly documented and provided to Coinbase already.
The decision to issue a license to Coinbase became possible only when certain amendments were made in the Fund Settlement Act. This is a law that also covers crypto businesses and services in Japan and applies to local and foreign crypto exchanges.
Now that the permission is officially granted, Coinbase is legally authorized to render crypto trade services to Japanese investors. However, the permission has been granted with some restrictions. Coinbase has been allowed only to offer trade services in 5 particular cryptocurrencies. These digital assets include five of the major cryptocurrencies such as Bitcoin, Ethereum, Litecoin, Stellar Lumen, and Bitcoin Cash.
Japan’s top financial regulator, the Financial Services Agency (FSA), announced last week that it has registered Coinbase as a crypto exchange service provider based on the revised Fund Settlement Act.
According to the FSA, Coinbase is approved to trade bitcoin (BTC), bitcoin cash (BCH), ether (ETH), stellar lumen (XLM), and litecoin (LTC).
The approved entity is a Japanese subsidiary of Coinbase Global, a Nasdaq-listed company.
Coinbase unveiled its plan to enter the Japanese crypto market back in 2018. The company said at the time that it would be “working hand-in-hand with the Japanese FSA to ensure compliance with local laws at every stage.”
Coinbase is also a member of the Japan Virtual and Crypto assets Exchange Association (JVCEA), a self-regulatory organization. Following Coinbase’s successful registration with the FSA, the association announced that the company is now its “first-class member.” In 2018, Coinbase joined the JVCEA as a “second-class member” — the categorization reserved for companies that have not registered with the FSA.