According to Bloomberg, Japan’s crypto regulator has decided to loosen its legislation on listing tokens. Before now, tokens are screened before crypto firms can add them.
According to the existing legislation in Japan, firms had to wait for long. This is because the screening process would take months. However, it appears that the era is over.
No More Screening Of Tokens
In the latest news, the JVCEA (Japanese Virtual Currency Exchange Association) has decided to shift from its current stance on the token listing. Hence, there will be no more screening process for tokens.
Instead, the self-regulated agency will supervise the sector differently. It will do so by regulating the assets only after they have been listed.
As a result, exchange firms must go through the listed tokens on their platforms. Also, they will have to remove all tokens that have issues. However, trading platforms must report all token listings to the regulator.
Usually, the screening process for the listing of tokens takes about six months or more. This affected the growth of the crypto sector tremendously.
CryptoPotato also noted that the recent measures won’t apply to ICOs (Initial Coin Offering) for now. However, the agency will make a final decision before the end of 2022.
Before the regulation, the present government recorded displeasure with the screening process. It noted that it stopped local cryptocurrency firms from developing.
Meanwhile, the government indicated that protecting investors’ rights should remain a top priority. At the start of 2022, the JVCEA issued a new policy for crypto firms. The approach allowed registered exchange firms to add “green-listed” crypto with any screening.
Coinbase Global, an exchange in the US, has over 100 assets on its platform. Meanwhile, GMO Coin, a Japanese-based exchange, has only 21 cryptocurrencies.
Due to the few coins on their crypto platform, Japanese-based firms found it hard to attract customers. This made it difficult to compete with foreign exchange firms.
Japan Moves To Regulate Stablecoins
After the collapse of Terra’s ecosystem, Japan’s Parliament passed legislation on stablecoins. The report noted that the bill is to tighten the scrutiny of stablecoins.
As a result, all stablecoins in Japan must be pegged to the Japanese Yen. Another option is to peg them to a legal tender before they can be considered stablecoins.
Furthermore, Japan took a drastic step after the fall of Terra’s USD. The report states it fell because it had no reserve assets pegged to a fiat currency. The Japanese authorities believe that this would help to protect investors’ rights.