Japan Finance Ministry Guides Bitcoin Exchanges, Sets Strict Rules
Japan sets out guidelines to the host of new exchanges looking to operate in the country.
Shortly after recognizing Bitcoin and digital currencies, Japan continues to take strategic steps to create an attractive environment for digital currency trading and use in daily purchases. Companies are lining up to open exchanges based on the guidelines put forth by the finance ministry.
Japan is taking the initiative other nations have been cautious to embrace. Having recently recognized Bitcoin and digital currencies as money, there is already a scramble by eighteen applicants to become licensed exchanges.
The fact that tax will no longer apply to the purchases of digital currencies shows the nation famous for being a leader in tech is serious about creating an attractive environment for the market around digital currencies to grow.
The finance ministry has set out ground rules for obtaining a license to operate an exchange regulation and guidelines that were not around in the bygone wild west days of Mt. Gox.
The license lays out requirements for the finances and asset management structures an exchange must follow to operate in Japan as of April 2017.
Merchants and investors
Asia Nikkei reported that more than 10 companies will launch exchanges in the land of the rising sun as demand is set to soar. These legally registered exchanges will help trade, as it will be cheaper, easier and safer for local traders.
The effect is twofold, as more merchants start accepting Bitcoin throughout 2017.
The first is as an investment vehicle, while the second, and the most important, as a currency that can be used to purchase goods in physical stores.
Clearly, Japan is reaching the target of using the currency in day to day purchases, in a move which may be dubbed the holy grail moment of digital currencies since Satoshi Nakamoto’s whitepaper.
“There is demand among our clients for cryptocurrencies, given their rising value,” said a source at one of the companies, explaining the investment factor.
Exchanges get set
All of the companies are substantially backed by capital as public companies. This shows an interest in investing in the digital currency space that can only be rivaled by that of New York, if even.
Understandably, another Mt. Gox like situation cannot be allowed to happen again. An SBI Virtual Currencies representative explains:
“We didn’t even have minimum guidelines [back in 2014, when Mt. Gox collapsed] so users will now feel more secure.”
The digital currency space could have very easily remained tainted with the collapse of Mt. Gox, but instead Japan recognizes that it was a stumbling step of days gone by and there is real potential in embracing Bitcoin and other digital currencies, leading the way for other countries.