The Financial Services Agency (FSA) of Japan plans to cap the leverage for cryptocurrency margin trading.
Capping Cryptocurrency Margin Trading
According to the Nikkei Asian Review, Japan’s financial regulator is looking to reduce the leverage limit for cryptocurrency trading in the country. Reports also indicate that many stakeholders in the country are clamoring for such a lower leverage cap given the volatility of virtual currencies.
On Wednesday (October 24, 2018), the FSA recognized the Japan Virtual Currency Exchange Association (JVCEA) as a self-regulating body for the nation’s cryptocurrency exchange market. Back in July, a few months after the JVCEA’s formation, the call for limiting the leverage cap was the Association’s first proposition with a 4:1 leverage limit on margin trading.