Crypto regulations in Japan have been a bit tough and inhibiting of late, but that’s about to change. The Japanese government is now considering loosening the harsh restrictions to let authorized crypto exchanges list coins in a more friendly regulatory environment.
The decision was made to stop the worrying exodus of crypto-focused startups from the country. The move by the Japan Virtual and Crypto Assets Exchange Association is meant to shore up startups in the crypto space and revive the struggling market.
Waiver Applicable Only To Tokens “Not New” To The Japanese Market
Initially, this provision will apply to crypto coins already known within the Japanese crypto market. There will be fewer restrictions for the exchanges to list them. This provision is expected to take effect sometime in December 2022.
Shorter Pre-Screening Process
Also, the regulatory authorities plan to do away with the arduous pre-screening process for both existing and new coins in the Japanese market, but that will take effect sometime in March 2024. This includes coins that enter the market via ICOs (Initial Coin Offerings). For some time now, the pre-screening process for crypto coins and startups has been a gruelling ordeal that often takes a while to be completed.
This will change as the restrictions are loosened. This new development is fueled by a recent decision passed by the Japanese cabinet on October 14. The directive required crypto-related entities to provide enough useful information as a contribution to efforts to curb money laundering. From a critical point of view, it would be senseless for the authorities to demand crypto entities to guard against money laundering whilst choking the industry with additional strict policies. This could be the logic behind loosening the said restrictions while the entities compensate on their side.
Government To Consider Tax Reforms
Crypto startups in japan will also sigh relief as authorities express willingness to revise tax laws that have been a source of complaints by the startups. Crypto groups have long urged the government to refrain from taxing paper gains and hurting the market.
Also, the Japanese government seems to nurture an interest in crypto and NFT. According to Prime Minister Fumio Kishida, Japan will make efforts to participate in the development of Web3 technologies. He singled out the Metaverse and NFTs. Japanese local authorities were rewarded for their work with NFTs back in September 2022.