BitGo will provide cryptocurrency cold storage services to the Japanese marketplace Bitgate to ensure the security of digital assets.
Bitgate management announced that it has decided to use the BitGo service to meet the new requirements set by the Japan Financial Services Agency (FSA). On May 1, new laws to regulate the cryptocurrency industry came into force in Japan – the Payment Services Act (PSA) and the Financial Instruments and Exchanges Act (FIEA).
According to these laws, Japanese cryptocurrency exchanges are required to interact with a third party firm that will store customer funds using cold wallets. BitGo CEO Mike Belshe said that by partnering with BitGo, the Bitgate exchange will comply with the new rules of the local regulator.
“The Japanese government has begun to pay more attention to the safe storage of digital assets. Japan is known for its fierce attitude towards the cryptocurrency industry, given the situation with the closed exchange Mt.Gox and the Coincheck hack, ”said Belsch.
Recall that in January 2018, the Coincheck trading platform reported a hacker attack, as a result of which NEM tokens worth $ 532 million were stolen.A few months after the hack, the exchange was bought by Monex Group, one of the largest brokerage companies in Japan, which helped to restore the site.
Belsch added that the FSA is aware of the risks associated with holding custom assets, whether in the cryptocurrency or traditional finance industry. By tightening the requirements, regulators are concerned about the safety of users, which is why keeping digital assets in cold wallets has become a requirement for cryptocurrency exchanges in Japan.
According to Belsh, BitGo already provides its services to six Japanese exchanges that have received a license from the local regulator. As a reminder, in May the company began providing custodian services to the Indian exchange CoinDCX, and last year BitGo announced a partnership with the Genesis Global Trading OTC trading platform.
