The country’s top financial regulator has instructed cryptocurrency exchanges not to handle transactions that are subject to asset-freeze sanctions. Unauthorized payments to sanctioned persons carry a three-year prison sentence.
The Financial Services Agency of Japan and the Ministry of Finance have asked cryptocurrency exchanges to comply with sanctions restrictions.
The Financial Services Agency (FSA), Japan’s primary financial regulator, declared Monday that the country will contribute to international sanctions efforts in response to Russia’s war on Ukraine.
According to the FSA, the Cabinet has given its consent to implement “a variety of measures, including payment limits under the Foreign Exchange and Foreign Trade Act.”
The financial regulator and the Ministry of Finance have asked crypto exchanges in the country not to conduct transactions that are subject to asset-freeze penalties against Russia and Belarus, according to the financial regulator. The FSA provided the following information:
Sanctioned persons cannot be paid in any way, including with crypto assets, without prior approval.
Unauthorized payments to sanctioned persons carry a penalty of three years in prison and/or a fine of up to one million yen ($8,481), according to the regulator.
The announcement came after the Group of Seven (G7) governments announced sanctions against Russia on Friday. According to Reuters, a top FSA officer said:
To keep the G7 enthusiasm going, we decided to make an announcement… The sooner you start, the better.
According to the news outlet, the FSA and the Japanese Ministry of Finance said in a joint statement that the government will work together to reinforce measures against the transfer of cash using crypto assets in breach of the penalties.
According to the list of recognised crypto exchanges on the FSA website, there are currently 30 registered crypto exchanges in Japan.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.