Is it possible for foreign companies to do ICO for people in Japan?
We hear a lot from foreign clients about legal aspects of cryptocurrency in Japan.
In this series, we will clarify legal regulations regarding cryptocurrency in Japan based on Financial Services Agency, who is responsible for cryptocurrency regulations in Japan.
1- All of the legal regulations regarding ICOs are announced by Financial Services Agency
2- In Japan, you need a license to issue tokens because issuing tokens are categorized as “virtual currency exchange service”
3- Voluntary groups are trying to change the situation, so there is a chance that this regulation would change in the future
Who is announcing the legal regulations regarding cryptocurrency in Japan?
In Japan, all of the legal regulations, including ICO, are announced by Financial Services Agency. Every company and individual follow the rule written by Financial Services Agency and it is crucial for foreign companies to understand the regulation announced by Financial Services Agency.
Is ICO not possible in Japan?
Under the current regulations, ICO and trading tokens are categorized as virtual currency exchange service. As mentioned above, you need a license to practice virtual currency exchange service, and as of now, only 19 companies have the license (most of them are cryptocurrency exchange). It is very difficult to get a license, and after the CoinCheck Incident in 2018, only 2 companies got the license.
Future of ICO in Japan
In March, because it is so hard to acquire the license for virtual currency exchange service, a group called JCBA wrote a proposal to Financial Services Agency.
In this proposal, JCBA wrote that Japan is left behind and argued for deregulation of ICO and STO in Japan.