Coincheck exchange service headquartered in Tokyo, Japan announced today that they are planning to stop handling certain cryptocurrencies in compliance with a business improvement order from the Financial Services Agency. The target currencies are Monero (XMR), Augur (REP), DASH, and ZEC.
Coincheck says that they will implement “partial abolishment of purchase and sale, deposit / withdrawal, possession and ownership of the target virtual currency on Coincheck, lending to our company.”
The notice on the Coincheck website mentions that:
“In connection with the unauthorized remittance of virtual currency NEM due to unauthorized access recently, we received a business improvement order from the Financial Services Agency under Article 63-16 of the Financial Settlement Law on March 8, 2018. We take this measure as solemnly and sincerely, reflect on our deep reflections, drastically review our internal control system and management control system, and rethink our management strategy that thoroughly protects customers.
As a part of this review, based on the fact that it is necessary to further develop and strengthen the management system of AML / CFT in the future, we deem that it is not appropriate for us to deal with currencies that are of little concern, We revalidated various risks based on the characteristics of As a result, the following currency handling will be abolished.” – Google translation, original post in Japanese.
Current currencies held by Coincheck will be sold at market rate on the date of discontinuance, and be converted to Japanese yen. The sale income will be added to the relevant client’s Coincheck account balance.
FSA has been in tight control of cryptocurrencies from the beginning to make sure that it will not hurt the economy of Japan. This move by Coindesk might hurt the abolished currencies and their reputation making it hard for them to compete. Those who have invested in them will not be happy either but complying with the FSA regulations is paramount for Coincheck’s business.