Coincheck has decided to stop Leveraged Trading in 2020

Japanese cryptocurrency exchange Coincheck has abruptly decided to cancel leveraged trading just months after relaunching the tool. In a blog post on Dec. 16, the platform said it had already stopped users from creating new leveraged positions.

Image via The Japan Times

The planned end date for leveraged crypto trading is 12:00 on Friday, March 13, 2020, by which deadline all open positions should be settled. Customers will then have until the end of March 2020, to transfer any Yen balance in Coincheck’s leverage account to their own trading accounts.

The blog post wrote that Coincheck has decided to end the ‘leverage transaction’ service on Friday, March 13, 2020. If you, as traders, have a current position, they would like to ask you to settle all positions by the deadline and transfer the Japanese yen balance in Coincheck’s leverage account to your trading account.

If positions are not settled by the end date, it will be automatically closed, and any balance transferred to the leveraged account. Similarly, any leverage account balances not transferred by the end of March will be automatically transferred after this date.

Officials did not give a reason for the move, which comes around six weeks since leveraged trading reappeared after a one-month absence. It seems that Coincheck has for now decided not to involve itself in providing leveraged crypto trading at all, perhaps due to a lack of customer interest.

The reason may be Coincheck has been lost over $500 million after the most famous hack in Crypto history since Mt. Gox. Coincheck’s President, Toshihiko Katsuya, in an interview, had called it the largest cryptocurrency hack in history, following which regulations were made even more stringent in the country.

In August, Coincheck reduced leverage cap of 4x, down 20% from the previous cap of 5x. At the time, the exchange said it was following guidelines from Japan’s self-regulatory cryptocurrency exchange body, the Japan Virtual Currency Exchange Association (JVCEA).

More broadly, criticism has taken aim at margin trading offered by cryptocurrency exchanges in recent months. Specifically, analysts have linked the tool to increased volatility in Bitcoin (BTC) markets.

In the statement, Coincheck assures users that it will continue to improve usability and work on new services which will be supported by customers.

Read more:

Follow us on Telegram

Follow us on Twitter

Follow us on Facebook

You might also like

LATEST NEWS

LASTEST NEWS