Japan FSA Warns Crypto Exchange Bybit over Unauthorized Operations

Japan's FSA has issued a warning letter to the Bybit cryptocurrency exchange for allowing Japanese residents to use the platform without authorization.

May 31, 2021 | AtoZ Markets – Japan's financial watchdog issued a warning on Friday to crypto derivatives exchange Bybit for operating without registration, a first such warning from the regulator in over three years.

The Japan Financial Services Agency (FSA) said that Bybit is allowing Japanese residents to use the exchange, even though it lacks permission. In comparison, crypto derivatives exchange Deribit, blocks Japanese IP addresses.

It is worthy of note that the FSA hasn't issued a warning like this to a crypto exchange in over three years. In March 2018, the regulator warned Binance over unregistered operations. Last year, Binance said that it would implement a "gradual restriction of trading functions" for Japanese residents "at a later date." But the exchange still appears to be operating in the country.

Read also: FSA Requests Japanese Crypto Firms to Implement FATF Travel Rule

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As for the Singapore-headquartered Bybit, it is the second such warning for the exchange in recent months. Earlier this year, the UK's Financial Conduct Authority (FCA) issued a warning against Bybit, and the exchange had to cease its operations in the country.

At the moment, Bybit is the fourth-largest bitcoin futures exchange in terms of both trading volumes and open interest — the value of outstanding derivative contracts that are yet to be settled.

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