Coincheck Stops All Operations Due To JVCEA Guidelines Revision

Coincheck stops all operations and all-new margin trading orders until the end of next month due to the revision of the JVCEA guidelines as we can read in the altcoin news below.

The Tokyo-based crypto exchange issued a statement on its website at the end of this month as the platform announced the suspension of the new margin trading orders. Also, Coincheck stated that the services will be capped at 4x and this move will see a reduction of 20 percent from the former crypto margin trading cap set at 5x. The exchange also released guidelines for customers who already had trading orders that were active and those with the uncommitted trading orders will have to wait until the end of September 2019 so they can be able to enter into positions and avoid cancelation.

For the customers that are already in open positions, the exchange noted that they will have to check to see if the margin cap reduction affected their trader as we can read from the excerpt from the company’s statement:

‘’Loss cuts will occur if the margin maintenance rate falls below 50% after changing the magnification. Check the margin maintenance rate and add margin or reduce the position as necessary.’’

Coincheck explained that the move is a part of the efforts to comply with the new and revised regulation guidelines provided by the Japan Virtual Currency Exchange Association –JVCEA which is a self-regulated body established to sanitize the local crypto industry in the country. The JVCEA identified the issue as the first to be solved shortly after its formation in April 2018. Back in March, the FSA announced the plans to introduce a limit on the crypto leverage trading between 2x and 4x and at that time the Financial Japanese financial watchdog stated that the new rules will come into force by April next year. The authorities in Japan explained that the move was necessary to provide robust protection for the traders on the market which is why Coincheck stops all operations this time.
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As it was reported earlier in the latest cryptocurrency news previously, there was a $9 million cut that the OKEx customers had to take in order to cover the $416 million Bitcoin bet and with volatility still being the key factor on the market, the narrative from the regulatory bodies is that the smaller margin caps will prevent a repeat such events from happening.