In a bid to develop the crypto market, Japanese regulators have decided to ease the process of listing tokens on crypto exchanges. In its current form, the rules related to the registration of properties have proven to be very demanding. This is a brake on the growth of the sector.
Japanese regulators: Allow exchanges to easily list tokens
While many countries are tightening crypto regulations, Japanese regulators are adopting the opposite strategy. The Japan Virtual Currency Exchange Association (JVCEA) plans to simplify the process of listing tokens on local crypto exchanges. Currently, before they can list a cryptoasset, exchanges must submit an application to the JVCEA. The regulator is then responsible for checking whether the token complies with the laws.
The verification process is long and complicated. By simplifying the rules, the waiting period will decrease from a few months to a few weeks. According to Bloomberg, this not-so-necessary process will begin as early as December. From there, local platforms will be able to list a token within 30 days of submitting a request to JVCEA. This period should be reduced to two weeks from April. This information was confirmed by Genki Oda, the vice-president of JVCEA.
Continue to monitor properties after listing
According to Genki Oda, the vice president of JVCEA, this relaxation is related to coins that have already been sold in the country. The verification process will continue for any new asset in the Japanese market. Japanese regulators may even drop preliminary verification of tokens, but only for tokens launched by local projects. Oda said details of the streamlined process will be available by March 2024.
Regulators are slowing listing assets on crypto exchanges, but they are still tough on monitoring assets that are already listed. For example, exchanges must regularly report quarterly on cryptoassets traded on their platforms. Any events like hard forks should be reported. Signs deemed inappropriate may be removed from the list.
Japan: understanding the role of JVCEA
As of 2020, the Payment Services Act (PSA) governs cryptocurrency exchanges and traditional financial exchanges. PSA established the JVCEA to help the Japanese government pass legislation that has not been overtaken by technological innovations. The latter has great power. It is allowed to apply crypto-related regulations to Japanese Virtual Asset Service Providers (VASPs). The rules are strict.
Due to the requirement of the verification process, only about fifty coins were exchanged in Japan. This is far from the 20,000 coins listed on coinmarketcap in September 2022. This relaxation of the rules is part of the strategy to revitalize the cryptocurrency industry in Japan. A vision supported by Prime Minister Fumio Kishida who is strongly convinced that Web3 will revitalize the local economy.
Along with relaxing the rules, Japan also said it wants to focus on digital technology and the implementation of Web3 services. The Prime Minister wants to expand investments in the metaverse and NFTs. Is Japan poised to become a major crypto hub?
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