Japan’s cryptocurrency policy has always been fairly loyal. The National Bank of the country did not plan to regulate digital circulation. But the collapse of Tokyo-based cryptocurrency exchange Mt.Gox made the Japanese government quite nervous. As a result, Japan was one of the first to introduce a legal framework for regulating the digital market. The country has established a licensing procedure for the exchange of assets, and introduced measures to counter money laundering. The Japanese government is concerned about the use of cryptocurrency in carrying out various financial offenses on the territory of the state.
The country is engaged in the issue of tightening the laws responsible for controlling the cryptocurrency, new instructions are being introduced from the Financial Action Task Force on Money Laundering (FATF). I agree with the opinion of the FSA experts that this can help to combat illegal withdrawal of money in the state.
The FSA plans to implement the FATF rule in early 2022. This measure regulates the behavior of service providers in the cryptocurrency market, it is necessary that they provide data on transfers made by senders and recipients of digital assets.
The legal framework for cryptocurrency in Japan has rather strict financial laws, and the introduction of new rules contributes to the expansion of legislation. Japan in its actions relies on the experience of South Korea, where rules were introduced regarding cryptography. The regulation of cryptography is becoming popular in many countries around the world. The idea of regulating cryptocurrency is spreading and widely supported by the governments of different countries, the authorities of the states are introducing new bills responsible for regulating the circulation of cryptocurrency assets. The prevalence of bitcoin and other digital currencies has caused the need for close attention from financial regulators.
In my opinion, the cryptocurrency community perceives such innovations with great anxiety. The appearance of new rules causes restrictions in this area. 2021 is called the year of regulation, this is due to the fact that an increasing number of states are adopting laws aimed at regulating the circulation of digital assets in their jurisdiction.
Restrictions and interaction with cryptocurrency in the country
The laws adopted in Japan in relation to cryptocurrencies and transactions with them, officially legalized in the country such cryptocurrencies as Bitcoin and Ethereum, they are called crypto assets. At the same time, digital currency is not recognized as a legal means of payment. Changes in the country’s financial laws are aimed at tightening control over digital assets, and also provide for the fight against hacking of exchanges. The Japanese legislative framework does not provide for a complete ban on issuing, receiving, storing or trading cryptocurrency. You can legally own and use cryptocurrency in the country, exchange for local fiat money is allowed, but subject to all applicable rules and regulations. Since, according to the law, the cryptocurrency is not a legal means of payment, private companies and individuals are not allowed to use digital currency to officially pay for goods and services, but the cryptocurrency assets themselves can act as a commodity. To do this, you need to contact registered exchange offices. Exchangers must be registered with the FSA. The state establishes certain requirements for these organizations, such as an annual audit, the presence of a secure computer system and others.