Following G7 pledges to tighten crypto sanctions, Japan’s Financial Services Agency and Ministry of Finance jointly announced penalties on cryptocurrency exchanges. The penalty on the crypto exchange will not comply with sanctions imposed on Russia. It will be due to the following Russian invasion of Ukraine.
Cryptocurrency exchanges that make unauthorised payments to sanctioned targets, including cryptocurrencies, could face up to three years in prison. They can even face a fine of one million yen (approx $8,487.52). If cryptocurrency exchanges discover suspected transfers from sanctioned targets, they must notify the Financial Services Agency.
The move follows the G7’s decision. The decision was to close a loophole that allows cryptocurrencies to avoid sanctions. South Korean cryptocurrency exchanges blocked Russian account addresses in March.
Major cryptocurrency exchanges such as Coinbase, Binance, and Kraken, on the other hand, will not remove all Russian addresses. Singapore-based exchange Crypto.com added Russian to its list of supported languages on March 3.
According to an industry association, there were 31 crypto exchanges in Japan. Given the new market’s popularity, global regulators are concerned about its safety for investors. The possibility of market manipulation was cited by the Securities and Exchange Commission. It was cited as one of the primary reasons for rejecting several applications for spot bitcoin exchange-traded funds.