The Japanese market is a young and developing one. Therefore, it’s not surprising that it faces some problems and obstacles during its development. Takao Asayama, the CEO of Zaif and creator of Mijin, a Blockchain technology service, talked to Cointelegraph about the current problems of Japanese Bitcoin and Blockchain markets.
Currently, there are two groups of influence in Japan – The Japan Authority of Digital Asset (JADA) and a group of independent companies that includes Zaif, BitBank and BTC-Box. Each group is searching for its own ways to communicate with the government and FSA.
Cointelegraph: What are the main problems in Japanese Bitcoin and Blockchain market?
Takao Asayama: due to the activity of remittance service’s clients of a major exchange that were trying to launder money. That was in April last year. Since that time banks started treating Bitcoin suspiciously and ceased opening accounts for Bitcoin businesses.
Only five companies are allowed to continue operating as Bitcoin exchanges. These are the only companies that FSA is listening to. Considering the current situation, in the next 18 months there will be no new Bitcoin entering the market. It will take time to change that. That is the general situation of Bitcoin businesses in Japan.
CT: What are the main prospects of Blockchain adoption among banks in Japan?
TA: At the moment, Mijin is the biggest Blockchain-based private platform. We have already introduced our Blockchain product in September last year but banks didn’t pay any attention to it.
There is no Blockchain technology here in Japan because we are the most conservative country and have the most conservative government in the world. So banks didn’t even imagine they were going to use Blockchain distributed ledger system.
I talked to the banks but still they all were looking to see who’s going to adopt the technology first. Then, finally, this month Sumishin SBI net bank officially announced it was going to do the experiment with Blockchain. It was in December and it was in the news. So everyone started jumping to the Blockchain.
Finally, Japanese banks started watching Blockchain market.
But still, most people have little trust in Bitcoin. Until recent times all the news and headlines about Bitcoin were negative and offensive. That’s why people tend to think all Bitcoin people and Bitcoin companies are criminals after the major Japanese media has published the headline about “Head of Bitcoin being arrested”.
Fortunately, people happen to have more trust in blockchain technology. I’ve talked with several Japanese public companies about testing Blockchain technology and they were interested in that.
It’s good that I’ve managed to contribute to the development of Bitcoin companies and to make their names clean in the market. So people got interested in Blockchain and Bitcoin. The change took place in the last 30 days or so.
CT: Is your market open for foreign companies to enter the Japanese market? Is there any interest from foreign companies to enter the Japanese market of Blockchain and Bitcoin? Are there any connections in the reverse direction? I mean are there any Japanese companies that want to enter the European or the US markets?
TA: It would be difficult for foreign countries to settle in Japan. As I’ve said, we are a very conservative country. So it’s hard to do business in this country. Japanese companies are difficult to work with. It’s extremely hard even to sign a contract. To enter our market, the company has to be big like Google. Otherwise Japanese companies would simply not listen to you.
If we talk about the reverse direction, I think it’s going to be Mijin. We plan to start doing that in February. Currently, no one else is trying to go out of Japan because, for example, for Bitcoin exchanges it’s like red auction market. Japanese companies have difficulties in going abroad just the same as foreign companies have difficulties in going to Japan.
And concerning Blockchain – there are no other companies that have original Blockchain technology here in Japan.
CT: How many companies from traditional space pay attention to Blockchain and Bitcoin space at the moment? How many companies from that space want to enter Blockchain market in Japan except the banks?
TA: It’s a hard question because they just started hearing the word “Blockchain” and they still think it’s suitable only for Bitcoin. Of course, there are some smart people and smart banks that know Blockchain could be used as their own private ledger system.
Financial institutions have very strict rules and guidelines here in Japan. And it’s hard to amend or change those rules. You’re going to be surprised how many e-money companies exist in Japan and they’re trying to exist in the market apart from banks. Many of those e-money companies are trying to adopt Blockchain technology because they can start implementing that technology to their business much earlier than banks. But it would be no less than two years before banking regulations are changed in Japan so companies could adopt Blockchain freely.
CT: Which technology do you think will be leading the cryptocurrency space in 2016? And what will be the most profitable service based on Blockchain in 2016?
TA: Mijin is launching a Blockchain-based product in 2016. We’ll present it in April. We already have a free Blockchain service that is already working and we’ve got a few banks working with this service.
And also Japanese e-money companies will start working with the Blockchain platform in 2016. But Bitcoin is still on the top of our market. And I think Blockchain will enter the market in stamping, notary services, smart contracts or logistics. I think logistics area will start growing in 2016.
As for profitability, I’d say, it would be remittances. I don’t know who is going to be the market leader but even the Swift started taking a lookout on Blockchain technology. So it’s going to be very tough competition in that market. And it’s going to be a big market.
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