Japan Eyes New Rules for Crypto Exchanges

Today in crypto, Japan’s financial regulator is preparing to require exchanges to hold liability reserves for customer assets. Crypto investment products have seen nearly $5 billion in outflows over the past four weeks, though late-week inflows suggest sentiment may be stabilizing. Meanwhile, the New York Stock Exchange has approved Grayscale’s Dogecoin and XRP funds for trading.

Japanese watchdog to require exchanges to hold liability reserves: Report

The Financial Services Agency in Japan will reportedly require cryptocurrency exchanges to maintain liability reserves as part of measures to guard against hacks or unforeseen events.

According to a Monday Nikkei report, Japan’s FSA will revise its requirements for local companies to include methods for quickly compensating users affected by security breaches or other causes. The financial watchdog reportedly cited recent hacks of global exchanges as part of the reason behind the change.

The Financial System Council, an advisory body to the FSA, is set to release a report on the matter following a meeting on Wednesday. One of the expected recommendations would require crypto firms to create liability reserve funds.

The move follows reports that the FSA plans to review regulations that would allow banks to purchase and hold crypto assets. Japan remains a country with a high concentration of crypto users, with about 12 million accounts registered as of February, according to data from the FSA. The country has a population of about 123 million.

$1.9 billion exodus and flicker of hope hits crypto investment funds: CoinShares

Cryptocurrency investment products have hit almost $5 billion in outflows over the past four weeks, but inflows during the final days of last week offered a small sign of improving sentiment.

Crypto exchange-traded products (ETPs) saw $1.94 billion in outflows last week, a small decline from the $2 billion exodus the previous week, according to a Monday research report from CoinShares.

The four-week total now stands at $4.9 billion, marking the third-largest outflow run on record. Only the March tariff-driven sell-off and the February 2018 downturn were bigger.

Still, CoinShares noted “tentative signs of a turnaround,” citing $258 million in inflows during the last trading days of the week following seven straight days of redemptions.

XRP (XRP) investment products were a rare bright spot. XRP exchange-traded products (ETPs) recorded $89.3 million in inflows last week, defying the broader downturn even as the token fell 6.9%.

Solana (SOL) ETPs were in the red with $156 million in outflows and SOL falling 3.5%, according to Cointelegraph data.

NYSE approves Grayscale DOGE and XRP ETFs, clearing launch for Monday

Grayscale’s Dogecoin (DOGE) and XRP (XRP) exchange-traded funds (ETFs) are teed up to launch on Monday after New York Stock Exchange subsidiary NYSE Arca approved the listing of the two crypto funds.

NYSE Arca filed with the Securities and Exchange Commission on Friday to certify “its approval for listing and registration” of the Grayscale XRP Trust ETF (GXRP) and the Grayscale Dogecoin Trust ETF (GDOG).

Bloomberg senior ETF analyst Eric Balchunas said the two ETFs are “scheduled to begin trading Monday,” with another of Grayscale’s ETF’s tied to Chainlink (LINK) “coming soon as well, week after I think.”

The signing off by the NYSE marks the final approval needed for Grayscale’s ETFs to go live, one of many ETFs tied to speculative cryptocurrencies that asset managers have brought to market in recent weeks.