Sandbox rules in Japan

The standards include “the maintenance of cold wallet, etc., under the consent of the related members,” the association announced on Saturday after one of its members, Coincheck, suffered a hackwhich led to an approximately 58 billion yen loss on its platform.

Look,the existing rules did in fact maintain the bounded, legal position; except no consent operaton.  "Consent of a member" means, in the sandbox, that the authorized protocol can check exchange account balances in run time before dropping a trade.

Also, note these rules impoly all trading protocol get equal (fair) access to the observables, no cutting in line from look to trade. So, in the Coincheck fiasco, the members should have noticed the imbalance and should have halted trading on their own.  

The bots betting the bit error  is the thing.  But bit error is chaotic? Yes, chaotic because members can view it and trade it slightly ahead of the pit boss. Bots that see bit error a bit odd in the margin will likely yield to the pit boss, or try and hedge the pit boss with inside information, all great stuff.  

We are maintaining the legal escrow chain back to the member in structured 'buyer beware'.  The protocols are short, the interaction between pit boss can be characterized by countable outcomes and thus pre-tested for stability by the regtech folks. This  is how it works, starting now.