What do the revised Japanese regulations mean for stablecoins?

Japan Financial Services Agency has been confirmed It will lift the ban on domestic use of stablecoins in 2023. However, there is no information about which stablecoins will be allowed. The new law, which will allow stablecoin trading, is expected to be implemented by June 2023. This comes a year after the decision to ban stablecoin forex.

In June 2022, the Japanese Diet passed legislation Ban foreign stablecoins and require stablecoin issuers to peg their cryptocurrencies to the Japanese yen or another recognized legal tender. Possibly affected by the measures, cryptocurrency exchanges A legendary sea monster And Coinbase It has since decided to discontinue operations in Japan, citing weak market conditions.

The FSA’s stance on stablecoins

The Japanese regulator’s new guidelines will require stablecoin issuers to pass individual user protection checks before approval. These checks will ensure that foreign exporters comply with regulations in Japan and that the underlying assets are properly protected.

"This does not mean that all foreign products of so-called ‘stablecoins’ will be allowed without any restriction," a spokesperson for Japan's FSA said in a statement. "FSA does not provide any opportunity to access such information before the decision is made,” the representative added.

Japan’s new stablecoin regulations are part of the proposed Cabinet Orders and Cabinet Office Decrees on amending the Payment Services Law of 2022. The new rules were introduced in December 2022, and aim to define requirements for electronic payment instruments and develop related registration procedures.

The Financial Services Authority (FSA) will be accepting public comment regarding changes to the Payment Services Act until January 31, 2023. According to the statement, law enforcement final date It is early June 2023.

As a major player in the global cryptocurrency market, Japan’s decision to lift the ban on domestic distribution of stablecoins is of great significance as it will shape the future of stablecoins in the country.

This action highlights the growing role of governments and regulators in the cryptocurrency market. It aims to establish clear regulations and guidelines to ensure user protection and promote stability in the industry.

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