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.
Coincheck: March deadline for settlement
Traders with open positions must settle by Mar. 13, 2020, and balance transfers should complete by the end of the month.
“Coincheck has decided to end the ‘leverage transaction’ service on Friday, March 13, 2020,” the blog post confirmed. Coincheck added:
“If you have a current position, we 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.”
Exchange quiet on motivation
Officials did not give a reason for the move, which comes around six weeks since leveraged trading reappeared after a one-month absence.
In August, Coincheck reduced the scope of available leverage by 20%. At the time, the exchange said it was following guidelines from Japan’s self-regulatory cryptocurrency exchange body, the Japan Virtual Currency Exchange Association, or 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.
