According to the Japanese Financial Services Agency (FSA), it received as many as 50 Bitcoin exchanges applications as of August 2017. Currently, the applications are being reviewed for compliance.
As per the reports of local newspaper Sankei Shimbun the agency is reviewing the exchanges dealing with digital currencies if they have implemented measures aimed at protecting their users.
Japan recognised Bitcoin as a legal payment method after amending its fund settlement law in April 2017. The approved law requires the FSA to ensure the registration of virtual currency exchanges in the country. All the exchanges are required to be registered by the end of September.
The FSA is required, under the law, to ensure the exchanges are in accordance with the requirements before registering them officially. Also, the exchanges are required to communicate with the FSA about the risks of financial losses factors like price volatility.
The FSA also ensures if the assets of exchange are segregated from the user deposits and warrants a proper risk management system is established.