Japan's Bitcoin trading volume ranks first in the world. The Bank of Japan: Cryptocurrency can be used in the field of electronic payments

After China's regulatory authorities tightened their Bitcoin trading policies, Japan's Bitcoin trading volume once again ranked first in the world. According to Cryptocompare, the yen's Bitcoin trading volume has accounted for 46% of the world's total trading volume, the US dollar ranks second with more than 30%, and the RMB's trading volume has dropped to 7%.

Data source: www.cryptocompare.com

Yuko Kawai, head of the Fintech Center of the Bank of Japan, introduced the development and regulatory status of cryptocurrency in Japan at a blockchain summit in Shanghai over the weekend. She pointed out that

As an illegal currency, cryptocurrency can be used in the field of electronic payments and can be exchanged for legal currency on exchanges; exchanges must be registered with relevant authorities. At the same time, opening a personal account on an exchange requires authentication and compliance with anti-money laundering laws.

Japan is a country with a relatively relaxed attitude towards Bitcoin and is also at the forefront of the world in the regulation of cryptocurrencies. In April this year, the Japanese government revised the Funds Settlement Act, recognizing Bitcoin as a legal payment method; in August this year, the Financial Services Agency (FSA) of Japan revealed that about 50 Bitcoin exchanges have submitted registration documents to the agency; Bic Camera, Air Regi, Peach Aviation and other companies have also announced plans to support Bitcoin payments.

However, Kawai Yuko admitted that Japan's digitalization process is much slower than China's. "You must bring cash when traveling to Japan. Japan has not yet entered the era of a cashless society."

Kawai Yuko

Yuko Kawai pointed out several reasons. The Japanese traditionally prefer cash. ATMs and banks are very convenient, and ATMs that provide 24/7 service can be found everywhere in Japanese convenience stores. Other payment methods, such as various bank cards, are expensive, so small retail shop owners prefer cash. At the same time, concerns about data privacy leaks and network security vulnerabilities, and banks and other card issuers maintaining traditional high-cost systems are also reasons why it is difficult for Japan to achieve cashless payments.

Talking about the current status of blockchain applications in Japan, Yuko Kawai said, "All blockchains are in the early stages of development and cannot support large-scale practical applications." On the question of whether it must be "distributed", Yuko Kawai believes that it is best for a company or a small consortium to maintain a centralized model, and sometimes non-blockchain solutions are more effective. At the same time, many problems still exist, such as expansion and processing speed, network security and data security.

Regarding the hot topic of ICO, Yuko Kawai analyzed the current regulatory status of ICO around the world and introduced that Japan applies different laws based on the nature of cryptocurrency, such as the Payment Services Act, the Financial Institutions and Exchange Act, the Securities and Exchange Act, etc.