East Asian country Japan on Friday passed into law a bill that defines stablecoins as digital money, Bloomberg reports.
The new law, which is expected to take effect in
a year, follows last month’s Terra-Luna
crash which shook the
cryptocurrency world.
In August last year, the Japanese financial markets
regulator had initiated
discussions and debates on new
crypto laws to bring new regulations around risky digital assets this year.
With the new law, Japan has become one of the
major economies to introduce a legal framework around stablecoins, the
outlet said.
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Stablecoin is a type of cryptocurrency whose value is
fixed to another asset such as the US dollar or Euro.
The new law also
demands that stablecoins must be linked to the Japanese yen or another legal tender.
Such stablecoins must also have been designed to
guarantee holders the right to redeem them at face value.
Also, the new regulation means that only
licensed banks, registered money transfer agents and trust companies can issue
stablecoins, the outlet reported.
Japan and Crypto Regulation
Sometime in this month, Bitcoin Satoshi’s Vision (BSV) is
expected to become the 15th cryptocurrency listed on Huobi Japan, one of the
most popular cryptocurrency exchanges in the country.
This number, when compared to the amount of
cryptocurrencies listed on exchanges in other countries, reflects the strict
regulatory environment cryptocurrency stakeholders operate in in Japan.
In 2021, Japan’s Financial Services Agency (FSA) established a
new unit to oversee digital
currency regulatory frameworks.
Citing three anonymous officials, Reuters had
reported then that the move followed the country’s concern over the influence
of private money on the existing financial system.
Japan has always been a progressive country when
it comes to crypto adoption and regulation.
Some of the earliest cryptocurrency exchanges were
established in the East Asian country and have led the market in Bitcoin
trading for many…
