Japan Regulators Relaxing Rules for New Token Listings
There will be some changes made to the screening process applicable to new token listings in Japan, as per the announcement by the JVCEA i.e. the Japan Virtual and Crypto Assets Exchange Association. The regulatory authority has the responsibility of regulating the listing of new tokens and crypto-assets on the country’s crypto exchanges.
Bloomberg published a report, which noted that Japanese crypto exchanges would no longer have to endure a long and drawn-out screening process involved in getting small and medium tokens listed on their respective platforms.
Regulator to Revise Screening Process
Sources with knowledge of the matter disclosed that the current screening process of the JVCEA would be changed, as applicable to listing of new tokens. Instead, the regulatory authority’s focus would now be monitoring the token and the industry in general after it has been listed on crypto exchanges.
If there are any underlying issues in tokens that are listed by crypto exchanges, they can be told to delist them in case of any problems. While the screening process is no longer a requirement for crypto exchanges, the JVCEA did add that exchanges would still be required to provide the regulator with its listing plans.
It is also worth noting that initial coin offerings (ICOs) will not be subject to the same rules implemented by JVCEA. The regulatory authority will announce its final decision by the year-end. The changes are in accordance with the plans of Fumio Kishida, the country’s Prime Minister, to ease regulations applicable to cryptocurrencies.
Previously, the premier had been critical of the screening process, saying that it was making it difficult for the industry to thrive in Japan. A new policy was introduced by the JVCEA at the beginning of the year, which allowed crypto exchanges to offer green-listed cryptocurrencies on their platform without having to go through the screening process. Since the screening process takes months, a number of crypto companies had complained that it was hindering their business.
It is due to this requirement that Japanese crypto exchanges offer a limited number of tokens. One of the top exchanges in Japan, GMO Coin Inc., only offers 21 cryptocurrencies on its platform. There are fewer coins to be found on smaller exchanges, which makes it difficult for them to compete against global ones like Coinbase and Binancethat are offering more than 100 tokens.
Japan to Regulate Stablecoins
While regulations for new token listings may be relaxed, Japan’s focus is now on regulating stablecoins in the country. The implosion of the TerraUSD(UST) stablecoin has alerted regulatory authorities all over the world about the risks associated with them. A law was passed by the Parliament of Japan for ensuring regulatory scrutiny of these stablecoins. They can only be categorized as stablecoin if they are pegged to a legal tender. According to Japanese authorities, this is the best way through which they can ensure the protection of investors from losses like the kind that UST investors had to suffer.