Japan's New Initiative: Startups Can Raise Funds with Crypto Instead of Stocks, Reports Say

16 Sep, 2023

Japan's New Initiative: Startups Can Raise Funds with Crypto Instead of Stocks, Reports Say

The Japanese government is reportedly planning a significant change in fundraising regulations, allowing startups to utilize crypto assets, including digital currencies, as a means of raising public funds, departing from the traditional practice of issuing stocks. This move has been disclosed by local media sources.

The newly proposed system is primarily designed to apply to a specific category of funds known as Investment Business Limited Partnerships (LPS). Japan has historically lagged behind many other nations in embracing digital assets, but recent developments indicate a shift in this stance.

On August 31, Japan's key financial regulatory authority, the Financial Services Agency (FSA), made a significant announcement by initiating efforts to amend the tax code pertaining to cryptocurrencies. This initiative reflects a more proactive role in regulating cryptocurrencies and aims to exempt local businesses from the year-end "unrealized gains" tax on cryptocurrency holdings.

During a keynote address at the WebX conference in Tokyo, Japanese Prime Minister Fumio Kishida reiterated the country's dedication to nurturing the Web3 industry. He emphasized its potential to revolutionize the internet and catalyze social change.

In related news, Binance, a prominent cryptocurrency exchange, recently confirmed its intention to extend its services to Japanese crypto users starting from August. This decision follows Binance's acquisition of the local exchange platform Sakura Exchange Bitcoin in November 2022, which paved the way for its reentry into the Japanese market.

Cointelegraph has sought additional insights from the Japanese government on this matter, but as of the time of publication, no official comments have been received.