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Japanese Official Denies Involvement in Cryptocurrency Exchange Investigations

Japanese Official Denies Involvement in Cryptocurrency Exchange Investigations

Reading Time: 2 minutes by on July 25, 2018 News, Regulation
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Months after speculations surrounding the government’s role in the investigation of a Japanese cryptocurrency exchange, Seiko Noda, the country’s internal affairs minister, has denied her involvement.

Japanese Official in Soup

According to a report by Japanese daily, Asahi Shimbun, on July 19, 2018, the government official did not play a role in scrutinizing the “non-registered cryptocurrency exchange.” Reports did not mention a name in particular, but going by historical events, it may be presumed to be Coincheck.

As reported by BTCManager in January 2018, Japan’s Financial Services Agency (FSA) raided the offices of Coincheck citing a violation of local legislation due to its non-registered nature. At the time, the regulatory authorities argued having provided ample time to several cryptocurrency exchanges to register their businesses before a specified date, failure of which led police teams to take “necessary steps.”

However, Asahi Shimbun claimed Noda’s representatives contacted the FSA after the stern warning was issued, demanding information on, and an explanation for, the event. Additional details revealed the allegations were made after Noda’s office held a meeting with the unnamed company’s officials in FSA offices.

Noda Declines Participation

Noda denied the subsequent investigations were due to her pursuit of the matter, instead stating the meeting was in regard to gaining an “overall general account of cryptocurrency exchanges.” The internal affairs minister further claimed “no vested interest in the company in question” and that her office’s decision to request the meeting “does not amount to exerting pressure.”

However, reports provide a different explanation. As per Asahi Shimbun, FSA officials visited Noda on January 30, 2018, to get perspective on the regulation of initial coin offerings (ICO).  Noda’s subsequent requests were conferred as political pressure on the matter, as noted by a senior FSA official:

“A public servant will likely take it as pressure if an aide to a sitting Cabinet member calls for a meeting in which an employee of a company the agency is looking into is also present.”

Noda denied the claims of pressure and acknowledged that her aide was present at the meeting, adding that her official and the company employee were friends. She also stated that the internal affairs ministry arranged the meeting after receiving a request for regulating cryptocurrency exchanges and that the ministry was unaware of FSA warnings towards the company in question, at that time.

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