Japanese exchange Liquid recently unveiled a mass asset removal from its platform, which COO Seth Melamed claimed necessary for legal compliance.
“Liquid works closely with regulators in Japan and Singapore,” Melamed told Cointelegraph on July 25.
Referring to Anti-Money Laundering, or AML, and Combating the Financing of Terrorism, or CFT, regulations, he added:
“As part of risk management we have to take a conservative approach regarding maintaining listings in tokens that are potentially viewed by regulators as in conflict with rules around AML and CFT and the Funds Travel Rule.”
Liquid provided a public statement
The exchange’s asset removal list includes privacy-focused coin Zcash (ZEC). A July 22 tweet from Zcash’s overseeing entity, the Electric Coin Company, tipped off the public on Liquid’s delisting of the asset, prior to an official statement from the exchange.
Liquid provided an official statement on the situation shortly after, citing plans to achieve Singapore’s regulatory approval as a crypto exchange operator. In light of its goals, the exchange decided to remove 27 assets from its platform, including Zcash, effective as of July 24. The statement, however, noted potential re-listing of assets at some point.
The exchange nears the end of its regulatory approval request
“Liquid is in the final stages of submitting our application to the Monetary Authority of Singapore, or MAS, for an exchange license under the Payment Services Act,” Melamed explained, noting difficult alterations the entity chose, spanning a number of categories, in pursuit of such regulatory approval.
Melamed described the situation as a tough grey area, adding:
“Liquid is working with the industry to provide a framework for adherence to regulations not always compatible with the innovative nature of blockchain-based assets. It’s never easy to be first, but we are committed to seeing this through.”
*Helen Partz contributed reporting to this story.