IPA IP 2021 Question 25
A question IPA Japan published in 令和3年度 ITパスポート試験 公開問題 問25, translated into English. ITPEC is based on the same exams.
Which of the following is the most appropriate description concerning crypto assets?
Explanation
The user gets an explanation of the contract from the exchange service provider and understands the transactions, risks and fees — crypto assets carry real risks, and the user has to know them before trading.
Crypto assets such as Bitcoin (called virtual currencies in Japan until 2020) are bought and sold through crypto asset exchange service providers. Under Japan's Payment Services Act such a provider must be registered with the Financial Services Agency and must explain the contract, the fees and the risks to its users. No state or central bank stands behind a crypto asset's value, which can swing widely, so the user should understand what is traded, at what risk and at what cost.
Answer (c)
Why not others:
- •(a) — choosing an unregistered provider defeats the registration system; doing this business without registration is illegal in Japan, and users are told to check the FSA's register of providers
- •(b) — there is no limit on the price movements of crypto assets: their value can fall sharply or vanish
- •(d) — the FSA and the Local Finance Bureaus do not recommend particular crypto assets or vouch for their security; someone posing as an official who recommends one is a known fraud pattern
Key rule: Trade crypto assets only through a registered exchange service provider, and understand the contract, risks and fees yourself: no authority guarantees or recommends a crypto asset.
Business Industry · AI-written, may contain errors
This question comes from the past questions IPA Japan publishes, translated into English by ITPEC Practice. ITPEC Practice is an independent study tool and is not affiliated with IPA or ITPEC. See the original paper (PDF) or Report an issue.