Japanese financial regulator considers imposing stricter crypto rules

[Leviathan.007]

Japan's financial regulator, the Financial Services Agency (FSA), has begun debating stricter regulations for cryptocurrencies in an effort to better protect Japanese investors.
In July, the FSA set up a dedicated department as well as a panel of financial experts to assist the government in overseeing digital, decentralized finance. According to the Jiji Press, the agency will also be responsible for tracking developments related to cryptocurrencies and the Central Bank (CBDC) digital currency initiatives.
The financial regulator intends to replace and enforce new cryptocurrency regulations by mid-2022. With these new regulations, the FSA hopes to stabilize the digital currency market while not harming development and innovation in the ecosystem.
The FSA revised a similar law in 2019 that effectively forced cryptocurrencies in Japan to implement new features to protect users' assets. The decision was linked to the hacking of Bitpoint, a $ 32 million loss-making cryptocurrency exchange in Japan.
In addition to the recent hacking of the Liquid cryptocurrency exchange, the FSA believes that domestic operators have not yet taken sufficient action to combat money laundering and price fluctuations.
Earlier this month, the FSA announced that it would approve the FATF’s Travel Rule by 2022, which requires all cryptocurrency service providers to share transaction data. Travel Rule was introduced in 2019 as a preventive measure against money laundering and terrorist financing with cryptocurrencies.
The drive will be supported by the Japanese Virtual Currency Exchange Association “to establish a necessary system” to accurately implement that travel rule.


Source: https://cointelegraph.com/news/japanese-financial-regulator-considers-imposing-stricter-crypto-rules

[CryptoBuds]

We should welcome them. The more the government debates and tries to regulate, the more the cryptocurrency will be promoted, the more the general public will know about it. When Bitcoin was banned in Nigeria, it was sold at a premium price, but the government could not stop investors.

I read the whole article, With hacks being heard from exchanges every year. Japan has begun to crack down against hacking from exchanges, and revised travel policies to prevent money laundering, which is also crypto-friendly.
I think all the steps taken by Japan are positive, I think they have taken such an initiative to officially adopt the cryptocurrency.

[Fesatmas]

Based on the case that occurred in Japan, it shows that the government's seriousness in supporting crypto is quite good, although users must share transaction data in order to monitor suspicious activity, which results in losses so that they do not happen again.

In my opinion, as a form of government attention to control all transaction activities to be more secure, then we will support this policy.

[avikz]

Stricter on whom? On the crypto related business or on the consumers? Japan has imposed 55% tax on crypto gains already since 2019. What could be more stricter for the consumers?

If the new rules will be imposed around security, insurance requirements and overall operating procedures on the crypto related businesses, then probably it would make sense! Otherwise Japanese people will give up crypto for good!

[Fundamentals Of]

If these rules do not affect my personal life and are created only for security purposes, then this is not bad.

In my opinion, as a form of government attention to control all transaction activities to be more secure, then we will support this policy.

This policy should be supported because this is for the protection of the consumers and the safety and security of the country against terrorism. But this comes with a price which many cryptocurrency users would find hard to accept.

I don't know if both of you would support this stricter rules on cryptocurrency even if it means mandatory KYC or even the submission of personal data of users from exchanges to government agencies.

[DapanasFruit]

While stricter regulations can mean that it will never be business as usual, there is actually no choice but to embrace the new reality. Japanese people are known to be good followers of their laws so I think this issue will not be a big problem with them. As long as regulations in placed can be fair and are not designed to kill the golden goose, so to speak, I think we should not worry about this. The Japanese government and leaders are very supportive of cryptocurrency and unlike China they don't have any inclination nor a plan to ban them.

[Shenzou]

To be honest this comes at no surprise, it is just a matter of time before a lot of other countries start imposing more regulation and more taxes on the crypto business, as the popularity of crypto has grown a lot over the past couple of years and there has been a massive amount of money being pumped into it and a lot of money  being made from it, and this is posing a problem for most governments and that is why they are taking some action to regulating them, and in my opinion it is best to regulate them and work around them than to completely ban them like what most countries did because they don't want to deal with them.

[hannahB4]

"Stricter crypto rules" should be a good one for the crypto community as a whole. Unless it is infringing the rights of the citizens to invest which I am not in support of that.

[pawanjain]

Everything has their own advantages and disadvantages. In this case the advantage is that strict regulation will decrease fraudulent activities such as money laundering in Japan.
The disadvantage is that this action may promote the use of KYC in all the crypto services provided in Japan.
So it depends on what perspective and priorities are. In my opinion, this should be considered as a good move because it will benefit the local public.
More number of users will feel safer to use cryptocurrencies and this might start a wide adoption of cryptocurrencies as well.

[kryptqnick]

Is it just about DeFi projects, or will it affect cryptos like Bitcoin and Ethereum as well? Also, what's that about sharing transaction data? Isn't that what blockchain is for? If it's not about sharing personal data like identification documents, but only about sharing crypto addresses, transaction IDs and sums involved, it seems like a totally normal rule. The article has these vague spots that make it hard to understand important details of what's going on in Japan and how bad it actually is. So far, it sounds to me like something targeting scammers, and there's nothing bad in that.

[cryptomaniac_xxx]

Japan is really spearheading crypto's, I mean they've the first nation to legalized bitcoin in 2017. So it make sense for them to have this kind of regulations and imposing stricter rules. And they could be the benchmark for outer countries like South Korea who also has stricter regulations because they are the second biggest in crypto as far as Asia goes (China is out already). And both of them have history of exchanges being hack as well. And as crypto is evolving so is the financial regulators trying to cope up with the latest trend (NFT's, staking etc).

[shield132]

We should welcome them. The more the government debates and tries to regulate, the more the cryptocurrency will be promoted, the more the general public will know about it. When Bitcoin was banned in Nigeria, it was sold at a premium price, but the government could not stop investors.

I read the whole article, With hacks being heard from exchanges every year. Japan has begun to crack down against hacking from exchanges, and revised travel policies to prevent money laundering, which is also crypto-friendly.
I think all the steps taken by Japan are positive, I think they have taken such an initiative to officially adopt the cryptocurrency.

I don't think so. When the governments trie to regulate the crypto, if the number of them increases and if the regulations are becoming strict and strict, at first it will promote crypto because there will be a lot of news written by the media but final result will be the less usage with high control. You can attract attention if you kill someone but this kind of attention will damage your future. On another hand, you can become rockstar (just saying) and gain people's attention and become celebrity. It will make your future bright. There is a huge difference between promotions and I think this kind of ones on bitcoin isn't that good. There are a lot of news written how volatile it is, a lot of futures contracts were liquidated in a very short time and a lot of people lost money. So huge interest and volatility at the same time makes it very risky compound and turns light on new regulations about investments.

[Gyfts]

With these new regulations, the FSA hopes to stabilize the digital currency market while not harming development and innovation in the ecosystem.

And how many times have we heard this excuse before? Surely government are incapable of imposing unnecessary regulatory burden on consumers to support their own ventures? As I have long said - the only way for government to truly "ban" Bitcoin is to tamp down on its usage through regulation, which will also promote usage of its own fiat currency. Japan's economy isn't large enough for this to have too large of an effect but the incremental regulations aren't something that's going to stop.

[AmoreJaz]

With these new regulations, the FSA hopes to stabilize the digital currency market while not harming development and innovation in the ecosystem.

And how many times have we heard this excuse before? Surely government are incapable of imposing unnecessary regulatory burden on consumers to support their own ventures? As I have long said - the only way for government to truly "ban" Bitcoin is to tamp down on its usage through regulation, which will also promote usage of its own fiat currency. Japan's economy isn't large enough for this to have too large of an effect but the incremental regulations aren't something that's going to stop.

if nothing else, at least their government is looking for ways on how to approach the crypto market as compared to countries that totally label crypto in illegal subject. in time, they will understand more on how to address crypto in a better way. and also, with people getting acquainted with crypto via their government's protocols, some will be curious about it and find how to utilise this technology.

[Lanatsa]

With these new regulations, the FSA hopes to stabilize the digital currency market while not harming development and innovation in the ecosystem.

And how many times have we heard this excuse before? Surely government are incapable of imposing unnecessary regulatory burden on consumers to support their own ventures? As I have long said - the only way for government to truly "ban" Bitcoin is to tamp down on its usage through regulation, which will also promote usage of its own fiat currency. Japan's economy isn't large enough for this to have too large of an effect but the incremental regulations aren't something that's going to stop.

if nothing else, at least their government is looking for ways on how to approach the crypto market as compared to countries that totally label crypto in illegal subject. in time, they will understand more on how to address crypto in a better way. and also, with people getting acquainted with crypto via their government's protocols, some will be curious about it and find how to utilise this technology.

Way more better rather directly make bans or prohibitions without any consideration or trying to assess if its really worth to be banned or would be adopted but of course it isn't surprising that if ever

they would adopt it then it would be normally following government protocol which is really opposing crypto true essence but doesn't matter though as long you can deal with it and wont mind

on making investment since you know that you wont be penalized or something get caught or have some charges.

[Ausgewielt]

Japanese people have their own culture. I personally think that Japanese people always strict in everything. It is good behaviour, they proof themselves become a country which contribute to technology usage by the world. most of japanese people have attitude and manners although sometimes being too much to do work so some of them become too stress. They are smart I think stricter crypto rules will not stop them to invest in bitcoin. They just adjust the regulations so it can appropriate for their country.

[Wind_FURY]

The Honey Badger don’t care. If any government/state over-regulates or censors, then Bitcoin will simply fill other inefficiencies in the economy, in ANY economy/market, legal or illegal. The usefulness, and the NEED for Proof of Work in Bitcoin will be in display.

[pooya87]

Stricter on whom? On the crypto related business or on the consumers? Japan has imposed 55% tax on crypto gains already since 2019. What could be more stricter for the consumers?

Not "consumers" but "traders". The tax is also targeting the profit that the traders are making from trading cryptocurrencies, some of which is massive amount of profit which paying a high tax on it won't even bother the profit maker.
Other than that Japan has 0% tax on bitcoin payments. In other words a merchant or a customer who are using bitcoin for payment pay no taxes whatsoever while they have to pay taxes if they accept fiat.

[lixer]

It’s a good thing that the Japanese government has accepted cryptocurrency and also working hard to create rules that will make their citizens feel safe when they are buying cryptocurrencies and making use of any exchanges.

This is really good and the good thing about it is that it is going to help convince the citizens to adopt cryptocurrency since they know very well that they are now safe when they are making use of bitcoin and other cryptocurrencies. Unlike other governments that have chosen to ban cryptocurrency instead of looking for ways like this to adopt it and make things better, in a way it will suit them and also suit their citizens.

[boyptc]

Japan is really spearheading crypto's, I mean they've the first nation to legalized bitcoin in 2017. So it make sense for them to have this kind of regulations and imposing stricter rules. And they could be the benchmark for outer countries like South Korea who also has stricter regulations because they are the second biggest in crypto as far as Asia goes (China is out already). And both of them have history of exchanges being hack as well. And as crypto is evolving so is the financial regulators trying to cope up with the latest trend (NFT's, staking etc).

I agree.

That's why they're becoming careful this time and they're anticipating some unexpected events and trying to avoid them as much as they can with what they're imposing.