Japanese monetary regulators have reportedly introduced new rules for cryptocurrency margin trading, local press agency Nikkei reported on March 18.

The Cabinet of Japan, has endorsed draft alterations to Japan's fiscal instruments and payment services laws, limiting leverage in cryptocurrency margin trading at 2 to 4 times the initial deposit.

Margin mercantilism is that the use of borrowed funds from a broker to trade a monetary asset, therefore forming a collateral for the loan.

The new rules — that are reportedly et to come back into force in April 2020 — would require cryptocurrency exchange operators to register within eighteen months of that date, which can supposedly enable the financial Services Agency (FSA) to introduce relevant measures in respect to unregistered cryptocurrency "quasi-operators."

Following promulgation of the new rules, entities dealing cryptocurrency can ostensibly be monitored equally to securities traders so as to guard investors. in addition, cryptocurrency operators are divided into teams to spot those engaged in margin mercantilism and people supplying tokens through initial coin offerings (ICOs).

With this move, regulators reportedly aim to secure investors from obtaining fixed in Ponzi Schemes, additionally as encourage legitimate firms to apply offerings as fundraising tools.

In January, the FSA disclosed that it had been considering the regulation of unregistered companies that solicit investments in cryptocurrencies. the development is reportedly a bid to shut a loophole within the country’s existing regulatory framework, in which unregistered companies that collect funds in crypto instead of fiat currencies stay during a legal gray zone.

Back in August 2018, the commissioner of the FSA said that the agency needs the cryptocurrency trade to “grow beneath applicable regulation” so as to find the “balance” between shopper protection and technological innovation, noting:

“We don't have any intention to curb [the crypto industry] overly. we might prefer to see it grow beneath applicable regulation.”

To know more on Cryptocurrency and Blockchain events, follow us on Facebook, YouTube,  Twitter, LinkedIn, Reddit, Telegram, BitcoinTalk, and we are also on Medium now