The Japanese Financial Services Agency (FSA) has announced that it will lift the ban that was placed on the domestic circulation of foreign-issued stablecoins such as Tether (USDT) and USDC in 2023. The aim is to ensure that stablecoins can be used for making payments as Japan seek to expand its footprint into the Web3 ecosystem.
According to a news report from Coinpost, the distribution of these stablecoins will be carried out in line with the “Revised Payment Services Act” which will be released in 2023. Following this guideline, issuers of domestically issued stablecoins will be obliged to prepare collateral assets as security for locally minted stablecoins.
Banks, trust corporations, and companies offering fund transfers are the only issuers allowed that will be permitted to circulate these foreign-issued stablecoins across Japan.
Furthermore, the stablecoins distributors will be mandated to protect their digital assets themselves without interference from the government and the maximum amount of remittances will be capped at 1 million yen ($7500) for each transaction.
The report also highlighted that the FSA will begin soliciting feedback on the drafted guidelines for stablecoins after the 26th. The stablecoins distributors are also required to keep records of transactions such as names as a way to prevent cases of money laundering.
Japan Eases Stance on Crypto
In an effort to ensure that Japan is digitally prepared for the future, Japanese regulators have proposed tax relief for crypto investors. A report from Bloomberg revealed that the government is set to reduce the 30% tax that was imposed on exchanges in the region.
Earlier in the month, Binance exchange also announced that it has acquired Japan’s Sakura Exchange platform, so it can provide its services to crypto users in the Japanese market.
Japan’s Central Bank is also working hard to ensure the testing phase of its digital Yen, its Central Bank Digital Currency (CBDC) in 2023. A local news media reported that the experimental phase will last for 2 years and would involve Japan’s top 3 banks and several regional banks.
Japan’s drive for a digitally enhanced economy also includes a push for the Metaverse. Japanese Prime Minister, Fumio Kishida gave a speech in October, that the Japanese government is making strategies to promote Web3 services in the country which includes the issuance of Metaverse and Non-Fungible Tokens (NFTs).
