Four years after leaving the country, major cryptocurrency exchange Binance is looking for a license to operate there, according to Bloomberg, which cited people with knowledge of the situation.
The action is being taken as Japan strives to embrace more web3-friendly policies and adopts a more open attitude toward cryptocurrencies. The exchange’s increased interest in the land of the rising sun is also attributed to the “substantial potential for user growth.”
Because it lacked the essential operating authorization, the largest cryptocurrency exchange by trading volume was forced to leave Japan. More specifically, Binance decided against establishing a base in Japan in 2018 as a result of inquiries by the securities commission, which later resulted in a warning to cease operations in the nation without a license.
A new set of financial administration policy guidelines from the FSA, which have just been published, speak of cryptocurrencies in a far more favourable manner than has previously been the case.
The announcement coincided with a shift in the Japanese government’s policy in favor of business. Prime Minister Fumio Kishida has praised Web3, the metaverse, and non-fungible tokens (NFTs), all of which he believes have the potential to boost the Japanese economy, as was previously reported.
Kishida has also stated that he intends to change the legislation controlling how cryptocurrency is taxed in Japan, especially as it relates to businesses that issue cryptoassets.
To counter this, the FSA recently issued a fresh warning to the Japan Virtual Currency Exchange Association (JVCEA), the nation’s self-regulatory authority for cryptocurrency exchanges, over the widespread application of FATF travel regulations for cryptoassets. It also attacked the JVCEA, expressing dissatisfaction with the organization’s speed in implementing anti-money laundering (AML) regulations, its decision-making and communication processes, and its delegation of executive duties.
The JVCEA acknowledged that it still has obstacles to overcome in order to achieve the FSA’s standards.
Other international businesses are attempting to penetrate Japan’s cryptocurrency sector as well, and some are doing so through acquisitions. For instance, earlier this year, Amber Group purchased DeCurret Inc., a crypto exchange that has been active in the nation since 2018.
In contrast to Japan’s actions, several nations have recently adopted harsher policies toward exchanges and the industry as a whole. Binance also came under regulatory scrutiny in a number of countries, including the USA.
As noted in January, Reuters asserted that despite declaring that it embraces regulatory scrutiny, Binance was operating in opposition to the same regulators. At the time, it asserted that the exchange was concealing information from authorities, acting contrary to advice from its own compliance department, and maintaining lax AML checks on a sizable portion of its user base.
Binance refuted the accusations and stated that it cooperates with law enforcement.
