While Japan has struggled to stay ahead in some industries over the past 20 years, each day fighting off the challenges from Taiwan, China, South Korean and others, it has made a strong effort to be a leader in Crypto, Blockchain, Fintech and related industries. Given the lead in the auto industry and recent growth concerns in pharmaceuticals, tech and others, Japan has shown unusual leadership in the world of crypto – note that at one point in the past 3 years, Japan exchanges had seen 62% of the Bitcoin volume traded. According to an article in Cointelegraph, by Hisashi Oki, Japan is working, or in the very least moving toward being the benchmark in Crypto Law.
On May 31, the Japanese House of Representatives amended two cryptocurrency-related laws, the Payment Services Act and the Financial Instruments and Exchange Act, which will come into effect in April 2020. The new law revises the term “Virtual Currency” and says that “Crypto Asset” would be a better term to use to describe cryptocurrencies. Recently, in G20 meetings the term “Crytpo Asset” is used. But this is just the tip of the iceberg in terms of changes.
The terms will change how the asset is viewed and it goes further as exchanges must change how they store crypto. The Financial Instruments and Exchange Act (FIEA), revised FIEA documentation introduced the concept of electronically recording transferable rights or ERTRs, to define ICOs and STOs ….. This article goes on to discuss derivatives and other, which is now at 81.61% of market volume (levarage, margin, future) with spot at 18.39% in Japan.
Our View: There are many ways that Japan can show leadership, by adjusting policy and making changes to current laws. However, we have seen changes in Japan over the past 20 years and the most important change that Japan must carry out is allowing the youth of this nation to have freedom to design and construct new products. The best minds have been shut down in many Japanese industries but for Crypto and related businesses, they need to be free.