Japan’s crypto exchanges are now asking for a relaxation of curbs on margin trading, unaffected by last year’s global digital-asset market crash.
Innumerous people in the industry seek permitted leverage for retail investors of four to 10 times whereas currently, customers can at most double exposure via borrowing, according to the Japan Virtual & Crypto Assets Exchange Association. “Reforming the leverage rule could make Japan more attractive for crypto and blockchain companies,” the association’s Vice Chairman Genki Oda said in a recent interview, adding that the step would give rise to more trading.The nation’s digital-asset exchanges are in talks to reach a consensus on a recommended leverage limit and may take their proposal to the Financial Services Agency as soon as next month, Oda said. Japan has moved toward easing some crypto rules, such as on token listing and taxation, but overall is viewed as having strict regulations. The continuous focus on investor protection enabled the Japanese arm of failed exchange FTX to return money to clients earlier this year even as the group’s US bankruptcy drags on.
Reported by an FSA official, crypto firms must present convincing reasons why loosening margin trading caps will help the government achieve its goal of expanding blockchain-based industries. The agency is ready to discussing the issue with digital-asset businesses, the official added.
