Crypto Exchange Gate.io To Shutter Services for Japanese Customers

Cayman Islands-based exchange Gate.io has declared the end of its services in Japan. The exchange noted that it would shut down all operations, including opening a new account for Japanese customers.

Gate.io's closure was primarily due to strict compliance issues with Japan's financial regulator. The exchange will allow its Japanese clients to migrate to other platforms that satisfy the country's regulations.

Gate.io to Migrate Customers' Accounts to Compliant Platforms

On July 22, Gate.io announced plans to shut down all crypto services for Japanese customers. The announcement reveals that the crypto exchange will help all affected clients transfer their assets accordingly.

Also, starting July 22, Gate.io will stop opening new accounts for customers residing in Japan. According to the exchange, this decision is due to stringent compliance demands from the Japanese Financial Services Agency.

Gate.io noted some steps to ensure a smooth exit in the country. Firstly, the crypto exchange will start a program that complies with Japanese laws and regulations.

Moreover, this move will support the transition of customers' funds to other exchanges and platforms compliant with regulations.

Again, Gate.io disclosed that it will remove all Japanese-language information from its platform. However, the exchange will still update customers regarding their account migration.

The exchange will also ensure that the service termination plan and account migration processes align with the FSA's compliance requests.

In its statement, Gate.io promised to release more details regarding its operational shutdown in Japan. However, it didn't indicate any specific date for the final shutdown of the exchange in the country.

Japan's Crypto Industry Outlook

With the growing popularity of digital assets, Japan transitioned as one of the international crypto hubs with several users. Moreover, the country is among the first to legalize cryptocurrency trading.

However, Japan has maintained stringent regulatory rules for digital assets. The country promulgated its Payment Services Act (PSA) to govern and control crypto assets.

According to PSA, all crypto exchanges in the country must register with the financial regulator FSA. They must also implement KYC programs by conducting customer identity checks and comply with anti-money laundering (AML) rules.

Gate.io doesn't have an FSA license. Though the exchange didn't specifically market its services to Japanese customers to avoid the regulator's direct crackdown, it offered a Japanese version of its website.

Moreover, Gate.io didn't roll out a physical office in Japan, just like several other exchanges. However, the FSA warned Gate.io to end its services due to lapses in compliance rules.

Besides Gate.io, some prominent crypto exchanges shut down services in Japan following warnings from the FSA.

In 2021, Binance left Japan after a warning from the regulator. But it opened again via an acquisition of local exchange.Similarly, BitMEX and Coinbase exited Japan in 2020 and 2023, respectively, following regulatory issues with the FSA.

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