Japan’s FSA pushes for stronger internal audits in crypto exchanges

The Financial Services Agency has released its 2024 monitoring report, urging better internal audits and closer scrutiny of crypto exchanges.

Japan’s financial regulator has called for stronger internal audits across the entire financial sector, highlighting the need for better oversight, especially for crypto exchanges.

In a Dec. 26 press release, the Financial Services Agency said it plans to update its “Current Situation and Issues” guidelines, bringing new auditing measures to comply with international trends. As part of its efforts to enhance audit standards, the FSA will also hold a “Roundtable on the Improvement of Internal Audits at Financial Institutions” in late January 2025.

In the press release, the FSA revealed that the roundtable will include representatives from the banking sector and the Japan Cryptocurrency Exchange Association, which includes members like bitFlyer and Coincheck. No further details were shared, though.

The latest initiative also comes shortly after Japanese police revealed that hackers affiliated with the North Korean regime are likely behind the $307 million attack on Japanese crypto exchange DMM Bitcoin.

In a Dec. 23 press release, the Federal Bureau of Investigation, alongside Japan’s National Police Agency, revealed that the hack, which occurred in May, is linked to North Korean cyber actors and is associated with the threat group known as TraderTraitor, also referred to as Jade Sleet, UNC4899, and Slow Pisces.