In a recent move to diversify funding methods for startups, the Japanese government has announced regulatory relaxations allowing startups to raise capital through cryptocurrencies, according to Nikkei. This decision comes as part of Japan’s efforts to catch up with international standards in handling digital assets.
Previously, startups in Japan primarily relied on traditional means like equity for fundraising. With this new regulation, startups can now offer digital assets, specifically cryptocurrencies, as an alternative to traditional securities when receiving investments from funds. This initiative is particularly targeted at funds known as Limited Partnership for Investment (LPS) in Japan.
This move is seen as a significant step for Japan, which has been perceived as lagging in the global digital asset space. By allowing startups to leverage cryptocurrencies for fundraising, the government aims to make the country more attractive for venture capital investments and to foster innovation in the burgeoning tech sector.
While Japan has been prudent in accepting crypto, it has actively adopted cryptocurrency regulations and initiatives. On June 27, 2023, as reported by Blockchain.News, the Financial Services Authority (FSA) of Japan announced its participation in the Monetary Authority of Singapore’s (MAS) “Project Guardian” initiative. Established by MAS in May 2022, “Project Guardian” explores the feasibility of applying digital technologies to various asset classes while ensuring financial stability and integrity.
According to MAS, the Financial Services Authority (FSA) of Japan is the first overseas regulator to join “Project Guardian.” MAS stated, “MAS is also pleased to welcome the Japan Financial Services Agency (JFSA) as the first overseas financial regulator to join Project Guardian. This paves the way for MAS and the JFSA to collaborate on digital asset innovation and best practices for asset tokenization, while safeguarding against risks to financial stability and integrity.”
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