Cryptocurrency may be legal in Japan!

NDTV Gadgets 360 Hindi

Japan needs to be more convinced of the benefits of making cryptocurrency investments easier for its population. The country’s top regulator has said so. Financial Services Agency commissioner Junichi Nakajima said he was open-minded about the potential benefits of having an asset like bitcoin as a faster and cheaper way to send cash. They are currently being used primarily for speculation and investment, and not as a means to transfer money. He added that the new challenges are coming from the wide spread of firms involved in decentralized finance, known as DeFi. The price of bitcoin in India as of 10 am (IST) on August 11 was Rs 34.4 lakh.

“We need to consider carefully whether it is necessary to make it easier for the general public to invest in crypto assets,” Nakajima, 58, who became the head of Japan’s financial regulator last month, said in an interview. While investors now have multiple ways to invest in a growing asset class, Japan is comparatively fairly restricted. Japan’s FSA set up a study group of outside experts in July and is expected to consider regulatory responses to DeFi in the coming months. Because investors are also looking to Nakajima for signals on this outlook.

Nakajima was involved in creating Japan’s first regulatory framework on cryptocurrency assets, including requiring exchanges to register in 2017. Following the massive coin theft at Tokyo-based exchange Coincheck in 2018, the country has tightened security.

conflict of exchange
Nakajima said the current regulatory framework on crypto exchanges has been effective in customer protection and anti-money laundering, with many of the 31 registered exchanges struggling financially, he said. His business situation is “rather difficult,” he said. Gary Gensler, chairman of the Securities and Exchange Commission in the US, said that regulating crypto exchanges is the easiest way for the government to gain immediate control over digital token trading. But he is also concerned with new ways people are getting into crypto, such as peer-to-peer lending on DeFi platforms.

A recent crackdown on exchanges, miners and traders in China caused some players to shift to less well-known tokenization and decentralized storage technology. Nakajima, a career bureaucrat and engineering chief at the University of Tokyo, said that unlike stocks, crypto does not have an underlying asset and is therefore subject to large price swings. This is one reason why the Japanese regulator does not allow crypto investment trusts, which are considered an easy way for the public to gain exposure to the asset class.

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