The Japanese Financial Services Agency (FSA) has set up a decentralized finance (DeFi) oversight unit, and the Ministry of Finance plans to increase the number of employees in its cryptocurrency unit.
According to a Reuters publication citing three unnamed Japanese officials, Japan is stepping up its diplomatic efforts to regulate cryptocurrencies around the world, as well as increasing industry oversight domestically.
To broaden dialogue with other regulators, the FSA has created a digital currency regulation oversight group, while the Japanese Ministry of Finance is considering increasing the staff of its cryptocurrency division.
“Japan can no longer ignore this issue as the global cryptocurrency industry is developing very rapidly,” one official said.
This initiative complements the efforts of the Bank of Japan, which is exploring the possibility of issuing a government cryptocurrency. The new Japan FSA will also regulate the DeFi industry.
In April, Japan’s Financial Services Agency announced that it would oblige cryptocurrency companies to comply with the FATF’s anti-money laundering guidelines from April 2022.
In addition, late last month, the FSA issued a warning that cryptocurrency exchange Binance operates in the country without a license and does not have regulatory approval to operate in Japan.