Bitcoin prices fell roughly 9% by midday Friday in the North American trading day, after Japan's financial regulator ordered several cryptocurrency exchanges to improve their practices against money laundering.
Experts say the digital currency fell to $6,081 U.S., breaking below $6,400 for the first time in about a week and reaching its lowest level since February 6
The order from Japan's Financial Services Agency led bitFlyer — the country's largest crypto exchange — to suspend the creation of new accounts while it makes improvements, especially in its measures to stop money laundering and terrorist financing
The agency gave the same order to five other exchanges after finding weaknesses in their controls against money laundering.
In the long term, the move builds a better ecosystem and makes sure this is a legitimate asset class.
In the short run, it reduces the flow of new capital to the largest exchange in the largest market for bitcoin trading. Bitcoin trading in Japanese yen makes up more than 60% of the digital currency's daily volume.
Bitcoin prices have suffered from the lack of new buyers in 2018, dropping by more than half this year after a climb to near $20,000 in December. The entire market capitalization of the digital currency has fallen by roughly 50% since January.
Japanese regulators have been in the vanguard of regulation, Japan being the first country to adopt a national system to regulate cryptocurrency trading after its exchanges were subject to some high-profile breaches.
