Japan Develops Stablecoin Law to Protect Crypto Investors
Japan passed a crucial law clarifying the legal status of stablecoins. The country is advancing in the international race; it wants to build safety nets around tokens whose attachment to mainstream currencies creates a broader market for cryptocurrencies. This move by Japan is part of a five-year effort to protect consumers investing in cryptocurrencies, followed by the shocking collapse of TerraUSD last month, which sparked debate over whether to regulate, ban or leave tokens alone.
Japan Financial Services Agency was preparing regulations before the market for Stabilcoins opened; It also contended in a paper in 2021 that a Better level of regulatory discipline was necessary for tools with such a huge potential influence on financial stability.
On Friday, the upper house of the Japanese parliament passed a bill that; it defines stablecoins as a digital currency, and establishes a binding bond with the yen; moreover, it approves their right of redemption at face value. The legal structure will come into force in 2023; The FSA may clarify the rules for a stablecoin issuer in the coming months. Analysts say the legal framework could make it harder for foreign players to enter the market. According to a new legislative definition in Japan, stablecoins may limit to banks, trust companies, and specifically licensed money transfer agents.
Japan and Crypto
The move echoed the FSA’s successful push in 2017 that Japan would become the first major economy to recognize Bitcoin as a currency. Shortly afterward, it became the first government to issue official licenses for crypto exchanges. The official legitimacy of bitcoin in Japan led to a significant early increase in market value; However, the FSA’s enthusiasm waned in late 2017; Since then, Coincheck users have lost $530 million in digital robberies.
Before the bill, Mitsubishi UFJ Trust and Banking Corporation had announced plans to launch their own Stabilcoin, Progmat Coin. Japan’s regulatory effort came at a global debate; about whether regulations on stablecoins and other digital currencies should be tightened.
Terra collapses, which briefly lost ground against the U.S. dollar last month, have sent shockwaves through global crypto markets; Consequently, it has intensified regulatory concerns. Stablecoins, such as TerraUSD, offer what should be a stable value warehouse for traditional currencies, unlike other, more volatile crypto tokens, including Bitcoin. In a speech this week, a Bank of England official warned of the risks of storing TerraUSD and other digital currencies; He also said that any stable coin that has reached the “system size” must meet the monetary standards of a commercial bank. In practice, this probably means issuing by a bank or non-bank, subject to strict central bank regulation and supervision.
Binance X Weeknd Partnership
Binance has revealed that it is the official sponsor of The Weeknd’s tour, called “After Hours Til Dawn”. It is worth noting that this is the first global concert tour that combines Web 3.0 technology for an enhanced fan experience.
The statement said Binance is partnering with HXOUSE, a think tank and community incubator for creative entrepreneurs, to release an exclusive NFT collection for The Weeknd tour with co-branded tour products. It is also noted that attendees’ virtual tickets can gain access to memorable NFTs, giving the fans a unique experience.
According to Weeknd, Binance is about community, people, and inclusion. There are plenty of cryptocurrency opportunities, and this is just the beginning. Based on the company’s co-founder, it is expected that this partnership will be the basis for the strengthening and return of numerous artists through the mainstream platform.
The Weeknd and Binance create a specially designed NFT collection; From which 5 percent of the sales will donate to the X.O. Humanitarian Fund. The Weeknd’s tour will start in July. Binance.US is the official sponsor of The Weeknd’s tour in the USA; Binance.com for the global part of the tour.
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