As international calls grow for tightening control of digital currencies due to the risk of their abuse for money laundering and terrorist financing, the Japanese government declared it was weighing legal regulation over cryptocurrencies.
According to Japantimes the government is exploring new regulations on virtual currencies in response to a report in June by the Financial Action Task Force, an international anti-money laundering and terrorist funding watchdog, which called for closer monitoring of virtual currency exchanges. The FATF’s Guidance for a risk-based approach to digital currency recommended that all exchanges be registered and licensed so that they would be subject to the same kinds of scrutiny as other financial services and money transfer businesses, and urged governments to require operators of digital currency exchanges to confirm the identity of clients, keep digital records of transactions and report any suspicious behavior to authorities.
Following this month’s arrest of Mark Karpeles, founder and chief executive officer of the bankrupt Tokyo-based firm Mt. Gox, Finance Minister Taro Aso said the government would consider new regulations on virtual currencies such as the introduction of a registration or license system for