KuCoin Receives Second FSA Warning Since November 2024
Japan’s Financial Services Agency (FSA) issued a formal warning to KuCoin in March for conducting unauthorized business in the country. The financial watchdog listed the Seychelles-headquartered exchange for “soliciting over-the-counter (OTC) derivatives trading via the internet” without the necessary registration. Three other platforms—NeonFX, theoption, and GTCFX—were also cited in the same notice.
This action marks a consistent pattern of regulatory pressure on the exchange. In November 2024, the FSA issued a similar warning to KuCoin for offering crypto services to Japanese residents without being registered. The agency escalated its efforts in February 2025 by requesting that Apple and Google suspend downloads of KuCoin’s mobile application from their respective app stores, further restricting its access to the Japanese market.
Japan Tightens Crypto Oversight as 12 Million Users Face Stricter Rules
The FSA's repeated warnings are part of a broader move to tighten oversight of the digital asset industry in Japan, a country with a significant crypto user base of over 12 million accounts. As of 2025, Chainalysis ranked Japan 19th in its Global Crypto Adoption Index, underscoring the market's importance.
Regulators are preparing to shift the legal framework governing cryptocurrencies from the Payment Services Act to the more stringent Financial Instruments and Exchange Act. This change will significantly expand the FSA's enforcement authority over unregistered platforms and alter reporting requirements for token issuers and exchanges. For international firms like KuCoin, the transition signals an end to regulatory ambiguity and mandates full compliance to operate legally within the country.
