Potential Threat to Binance Hurts Cryptocurrency Market

Potential Threat to Binance Hurts Cryptocurrency Market. Japanese regulators might impose sizeable sanctions against the cryptocurrency exchange Binance. This would make a significant impact on the cryptocurrency market as Binance is the largest trading exchange in the world based on 24-hour trading volume. This issue has caused the cryptocurrency market to take a hit with many currencies losing value due to the announcement that the trading market could be hurt depending on what happens next.

The Financial Services Agency of Japan cites that there will be warnings sent out based on a new fund settlement law. The group states that Binance has been operating in Japan without a proper license for doing so. This comes not long after nearly half a billion dollars in NEM coins had been stolen from the exchange back in January.

The Nikkei news service stated that the FSA is expected to file a warning against Binance over its actions. Binance would be subject to a criminal complaint if the group does not respond to the issues any time soon. This could lead to Binance being shut down in Japan, thus causing the exchange to lose a massive amount of business.

Binance stated on Twitter that it is cooperating with the Japanese authorities. It is going to continue operating as usual and has not yet gotten any mandates from Japan over its actions.

Japanese law states that all cryptocurrency exchanges that wish to operate in Japan must register with the national government. This comes amid concerns that cryptocurrency hacks could continue to move forward in Japan in the future. The National Police Agency cites that 149 hack cases took place last year, thus causing nearly 660 million yen or $6 million US in losses with the Ripple currency being subjected to most of those losses.

Japan has been working on possible regulations over the cryptocurrency market. The FSA met with regulators from around the world earlier this month to discuss issues surround these currencies and how they are traded.

Currency Declines

The Binance report caused the cryptocurrency market to lose a sizeable amount of its value. The bitcoin had gotten past the $9,000 mark, but it fell to around $8,500 not long after the Binance report came out. The trading volume for the bitcoin has remained stable and the losses for the currency have also stabilized as of around the end of the Thursday trading period.

Most currencies experienced a 24-hour drop of 5 to 10 percent of their values as a result of the news. Some currencies that experienced increases like EOS and Verticoin also had many of their gains from the past day wiped out, but they managed to go up by a few percentage points.

The Binance Coin, the currency produced by Binance itself, did not see much of a change in its value. The currency’s market cap is still trading at around $1 billion while the coin is hovering at around the $10 mark. There was a slight increase in the trading volume for the Binance Coin though. The currency has increased by a few dollars per coin within the past month.

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