Japan introduces new regulations to cap leverage in cryptocurrency trading


  • The Cabinet of Japan, the executive branch of the country’s government, is limiting leverage in cryptocurrency margin trading at two to four times the initial deposit.
  • The new regulations will help the regulators to keep investors safe from Ponzi Schemes and encourage legitimate companies to practice offerings as fundraising tools.

As per Nikkei, Japanese financial regulators have introduced new regulations for cryptocurrency margin trading. The Cabinet of Japan, the executive branch of the country’s government, has allowed draft amendments to Japan’s financial instruments and payment services laws, limiting leverage in cryptocurrency margin trading at two to four times the initial deposit.

The new rules will come into force in April 2020. It will require cryptocurrency exchange operators to register within 18 months. The Financial Services Agency (FSA) will have the authority to deal with unregistered cryptocurrency "quasi-operators." This move will help the regulators to keep investors safe from Ponzi Schemes and encourage legitimate companies to practice offerings as fundraising tools.


 

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