February 7, 2018 / 11:46 PM / 5 months ago

Japan regulator to inspect more cryptocurrency exchanges - Jiji

TOKYO, Feb 8 (Reuters) - Japan’s financial regulator is planning to conduct on-site inspections this week on several cryptocurrency exchange operators that may be vulnerable to cyber-attacks, Jiji Press reported on Thursday.

The Financial Services Agency (FSA) last Friday swooped on Coincheck Inc for surprise checks of its systems after the Tokyo-based operator had $530 million in digital money stolen by hackers.

After the late-January theft, the FSA said it would also investigate the other 31 cryptocurrency exchanges in Japan for security gaps, ordering them to submit a report on their system risk management. It said then that it would follow up with on-site inspections if necessary.

The FSA decided to inspect several exchanges after reviewing their reports, Jiji Press said, without identifying the operators. If regulators find problems with their operations they may consider administrative sanctions, Jiji said.

Officials at the FSA were not immediately available for comment.

The FSA has issued a business improvement order to Coincheck, while Tokyo police, as well as authorities in several countries, are investigating the heist.

Last year’s explosive rise in the value of digital coins and the flood of new retail investors drawn to the market have rattled global regulators nervous about a sector used largely for speculation. Officials have said cryptocurrencies are used by criminals to launder money. (Reporting by Chang-Ran Kim; editing by Richard Pullin)

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