Compliance and Security
Launched in the wake of the famous Mt.Gox hack that saw more than 850,000 Bitcoin stolen by hackers, bitFlyer takes both compliance and security very seriously. It was the first stock exchange licensed to operate in Japan, the United States, and the European Union
bitFlyer has the distinction of being a platinum member of the Japan Blockchain Association (JBA), which means that the platform meets the security measures and trade restrictions required by the association. bitFlyer reports that it uses the highest level of encryption technology available to keep your information and investments safe.
This includes security features such as mult-sig, which is a process that requires multiple keys to authorize a cryptocurrency transaction. Multi-sig should reduce the possibility of hacking – even if a hacker finds one of your crypto keys, they can only remove coins from your wallet if they also purchase all of your other wallet keys.
In addition, bitFlyer claims to store more than 80% of its users’ cryptocurrency offline, which helps reduce the possibility that hackers can gain access to large amounts of users’ funds. However, it ranked lowest in cybersecurity among the cryptocurrency exchanges we evaluated, according to CER, an independent evaluator of cryptocurrency exchange security.
Japanese Yen Crypto Purchases in the US
While most major exchanges allow cryptocurrency purchases with fiat currency such as the dollar, they are usually limited to the local currency denomination of the country. However, bitFlyer recently launched what it calls “cross-border trading,” which allows US-based consumers to buy and sell Bitcoin in Japanese yen and then gain access to the Japanese Bitcoin market.
While this may be attractive to certain types of investors, the feature is seeing limited rollout. US customers cannot deposit Japanese yen directly into their bitFlyer accounts, instead they must use Bitcoin to buy yen… which they can then use to buy more Bitcoin. Users may also be frustrated that if they hope to withdraw funds from their account, they must do so with Bitcoin or USD because bitFlyer does not support JPY withdrawals in the US yet.