Japanese cryptocurrency exchange Liquid announced that Quoine Corporation, its subsidiary, has been granted a Type 1 Financial Instruments Business License under the Financial Instruments and Exchange Act by the Japanese regulatory authorities.
Liquid will be able to trade derivatives on its platform. This will offer investment opportunities for both retail and institutional clients. However, a date was not revealed.
Liquid was founded in 2014. It has more than 800,000 customers. The platform also boasts the highest daily trade volume at $1.1 billion for 2021. The platform is licensed by the Monetary Authority of Singapore and operates under Japan’s Payment Services Act through Quoine Corporation.
Seth Melamed (chief operating officer at Liquid) shared his views on regulation in the sector.
The Type 1 license is the result of much preparation and collaboration from the entire Liquid Team. It also confirms that trading crypto derivatives can be done legally and with transparency.
Related: FTX funds $120M in debt funding for Hacked Liquid Exchange
Liquid was the victim in mid-August of a $97 Million security breach on its hot wallets. However, the company wanted to emphasize that the incident did not affect users’ wallet balances.
Hot wallets like Metamask or Phantom allow you to store and trade cryptocurrencies. They are more vulnerable than cold wallets offline.
The exchange reported positive news about a $120m debt financing investment by FTX Trading, a subsidiary. This was in a bid for the exchange to improve its balance sheet, support licensing efforts in Japan and Singapore, increased capital and liquidity generation, and customer support services.