Japan launches new fund to invest in blockchain, AI, VR and other projects

Japan has launched a new fund to invest in startups tackling blockchain, artificial intelligence, virtual and augmented reality, security technology and biotechnology.

The DG Lab Fund, run by DG Yamato Ventures, a joint venture between Digital Garage and Daiwa Securities Group Co. Ltd., will invest 20 billion yen ($190 million) over the next decade in startups specializing in these cutting-edge technologies.

The DG Lab Fund will work with DG Lab, an organization for open innovation research and development. Specifically, the Fund will leverage DG Lab’s network and research results on the five technologies to make strategic investment decisions.

Launched earlier this month and in Tokyo, San Francisco, New York, and Boston, DG Lab is the result of a collaboration between Digital Garage and Credit Saison aimed at creating cutting-edge businesses and developing innovative solutions in partnership with foreign companies. (Note: Credit Saison is Japan's second-largest credit card service provider)

Digital Garage and blockchain technology

In February this year, DigitalGarage participated in Blockstream’s $55 million Series A round. The investment transaction marked the company’s first major involvement in the field of blockchain technology. Digital Garage subsequently stated that the company aims to explore blockchain technology solutions deployed in the Japanese market (in collaboration with other professional companies).

With technical support from Blockstream, DG Labs said it is seeking to develop a general smart contract technology that leverages blockchain applications in the field, including rewards and loyalty programs, virtual currency exchange systems, electronic currency platforms, contract execution, value transfer and licensing automation.

The company is working with a number of partners on these blockchain-related projects, including Bank of Yokohama, department store chain PARCO, Resona Bank, Japanese legal portal Bengo4.com, and tech startup iRidge.

Founded in 1995 and headquartered in Tokyo, Digital Garage is an IT company that develops innovative solutions using cutting-edge technologies.

Japan has been cautious about cryptocurrencies and blockchain technology following the collapse of Mt. Gox, the world's largest bitcoin exchange.

In February this year, the Japanese Cabinet formally approved a set of regulations to recognize digital currencies as authorized payment instruments. The optimistic move has triggered a lot of Bitcoin and blockchain-related activities, including the launch of cryptocurrencies FISCO Coin and Triple Dice Exchange, in addition, Infoteria and Singaporean startup Dragonfly Fintech have collaborated to develop blockchain-based clearing and settlement infrastructure.

In April this year, Japan welcomed its first blockchain-specific consortium. The Blockchain Partnership Alliance is composed of 34 companies in the fields of technology, finance, and blockchain industries, aiming to educate the public and increase awareness of blockchain technology.