The Wall Street Blockchain Alliance will partner with R3 to develop solutions on their Corda blockchain platform.
The Wall Street Blockchain Alliance (WSBA) has joined blockchain consortium R3 to develop applications and solutions on their Corda platform, a Feb. 5 press release reports.
According to a statement made by the CEO of R3, David E. Rutter, the WSBA and R3 will collaborate in order to “advocate a strategic approach to collaborating with regulatory bodies so that financial markets, and beyond can gain the full benefits of blockchain’s capabilities.”
The WSBA is a non-profit trade association that promotes the general adoption of blockchain technology and crypto assets across international markets.
R3, an enterprise blockchain software firm with over 300 partners, has developed Corda, an open-source blockchain platform for both the private and public sectors across multiple industries. Corda is a blockchain platform that allows for institutions to transact directly with the usage of smart contracts while ensuring their user’s privacy and security.
In mid-January, R3 announced the launch of its Corda Network, with non-for-profit organization the Corda Network Foundation responsible for its operations.
On Jan. 30, Cointelegraph reported that Japanese financial company SBI Holdings would also partner with R3 as they aim to help them develop the local use of Corda blockchain on their platform.
Also at the end of January, major global banking payments network SWIFTrevealed its plans to develop a Proof-of-Concept gateway that would allow R3 to link to the SWIFT Global Payments Innovation payments from their platform.
As reported, Huobi Global’s wholly owned subsidiary, Huobi Japan Holding Ltd, acquired a majority stake in BitTrade last September. At the time, BitTrade was one of only 16 crypto exchanges in the country to have secured a license from national financial regulator, the Financial Services Agency (FSA).
Leon Li, Huobi Group Founder and CEO, has said that securing the license represents a significant milestone for Huobi, given the importance of the Japanese market.
Huobi’s press release takes pains to emphasize security provisions, outlining that Huobi Japan “features specialized distributed architecture, a Distributed Denial of Service (DDoS) attack countermeasures system, and A+ ranked SSL certification (the highest available).”
According to the press release, Huobi Japan supports trading of Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH), Litecoin (LTC), Ripple (XRP), and Monacoin (MONA).
While a license has been mandatory for all crypto exchanges operating within Japan since the amendment of the country’s Payment Services Act back in April 2017, the FSA has continued to ratchet up requirements for applicants throughout 2018, in the wake of last January’s industry-record-breaking $532 million theft of NEM tokens from Coincheck.
Ahead of Huobi’s majority stake deal — BitTrade became Japan’s first FSA-licensed platform to be fully acquired by an international investor, the Singaporean multi-millionaire and entrepreneur Eric Cheng. The investor also acquired BitTrade’s affiliate company, FX Trade Financial Co., Ltd — one of Japan’s leading forex trading platforms. Following the Huobi deal, FX Trade Financial retained 25 percent of the BitTrade’s shares.
Founded in China in 2013, Huobi Group has been headquartered in Singapore since Beijing’s crackdown on domestic crypto-fiat exchanges in September 2017. As part of its ongoingoverseas expansion efforts, the platform has recently rebranded its United States-based strategic partner trading platform HBUS to the better known Huobi name.
Following Coincheck’s very recent acquisition of an FSA license, the total number of regulator-approved exchanges in Japan stands at 17.
Last fall, an executive from leading U.S. crypto exchange Coinbase made positive remarks about Japan’s crypto regulatory climate, saying that the FSA’s intense focus on security is “good for us.” Coinbase has had plans to secure a license to operate within the country in the works since June 2018.
Huobi has seen $299.6 million in trades over the 24 hours to press time, according to CoinMarketCap data.
Japanese crypto exchange Coincheck, which suffered a $530 million hack in January of last year, is now a licensed entity.
Monex Group, the Japan-based online brokerage firm that acquired Coincheck for $33.5 million following the cyberattack, announced Friday that the exchange is now registered with the Kanto Financial Bureau, under the country’s Payment Service Act, effective immediately.
The license was approved by the country’s Financial Services Agency (FSA), on the basis of Coincheck’s improved risk management and governance systems with “concrete internal controls and customer protection in mind,” Monex said.
Following the massive hack of around 500 million NEM tokens in January 2018, the FSA had ordered Coincheck to strengthen its security systems and submit a business management improvement plan to the authority. At the time, the exchange was not registered with the regulator.
The breach also forced Coincheck to suspend its services for some months. Since then, the exchange has been phasing back in its operations. By November 2018, it had reinstated services for all listed cryptos on its platform.
Now with the license in place, Coincheck joins the growing list of regulated crypto exchanges in the country, including financial services giant SBI Holdings, which operates a registered platform called VCTRADE. U.S.-based exchange unicorn Coinbase has previously said it expects to become licensed in Japan in 2019.
All crypto exchanges in Japan came under anti-money laundering (AML) and know-your-customer (KYC) rules in April of 2017 when the country’s legislature passed the Payment Service Act and recognized bitcoin as a legal method of payment.
Over 160 firms are planning to apply for the crypto exchange license, the FSA said back in September, adding that it is looking to increase its staffing levels to speed up the review process.
Japan’s financial regulator is reportedly looking to close a legal loophole that lets unregistered investment firms solicit funds in cryptocurrencies rather than cash.
According to a report from Sankei Shimbun on Tuesday, Japan’s Financial Service Agency (FSA) is planning revisions to bring such schemes under the country’s Financial Instruments and Exchange Act, although no timeline for the changes was provided.
Currently, the act prohibits unregistered schemes from collecting investments in fiat currencies, but it does not mention cryptocurrencies.
The issue has reportedly received increased focus from the watchdog in the wake of rising incidences of crypto pyramid schemes in the country. Back in November, police in Tokyo arrested eight men alleged to have run such a scheme that collected 7.8 billion yen (almost $69 million) in cryptos from thousands of victims.
The eight were said to have collected most of the payments in bitcoin, as well as another 500 million yen (about $4.40 million) in cash, under the guise of a bogus investment firm called Sener.
Sankei Shimbun cited officials as saying that, if the scam had solicited only cryptocurrency, it’s possible the criminals would not have been caught.
Japan’s FSA has been actively regulating the cryptocurrency space since the shockwave that followed the collapse of the Mt Gox exchange in 2014. Measures have included instigating a licensing scheme for crypto exchanges and scrutinizing exchanges over security and compliance with anti-money laundering rules.
Just yesterday, the agency was reported to be considering approving crypto exchange-traded funds (ETFs). At the same time, it has now apparently dropped plans to approve trading of crypto derivatives on financial exchanges due to concerns the products would encourage speculation.
Japan’s Financial Services Agency (FSA) is apparently open to approving crypto exchange-traded funds (ETFs).
A Bloomberg report on Monday, citing a person “familiar with the matter,” said that the FSA is currently ascertaining institutional interest in ETFs that track cryptocurrencies and could ultimately give them the go ahead.
Japan’s ruling Liberal Democratic Party will reportedly submit draft legislation by March 2019, that could include such a move through amendments to existing financial rules. The bill, which would also bring in more self-regulatory oversight of the industry and class many ICO tokens as securities, could come into law by 2020, the report indicated.
However, Bloomberg added that the FSA has now dropped plans to include approval for trading crypto derivatives on financial exchanges due to concerns the products would mainly lead to speculation.
The increased scrutiny of the crypto space in Japan follows a major hack of the Coincheck exchange in January that saw around $533 million in cryptocurrencies stolen.
Crypto ETFs are seen by many market observers as a means to bring institutional capital into the sector, though not all are keen on the idea.
In the U.S., several participants are planning to launch such products, although the Securities and Exchange Commission (SEC) has not yet approved any. Back in August, the the agency rejected nine bitcoin ETF applications “to prevent fraudulent and manipulative acts and practices,” and in December postponed a decision on a product from VanEck/SolidX until February.
Further, SEC chairman Jay Clayton said at CoinDesk Consensus in November that he doesn’t see a pathway to a cryptocurrency ETF approval until concerns over market manipulation are addressed.