Japan’s top regulator is reportedly considering a policy change that would allow banks to offer Bitcoin custody and trading services.
Japan is considering allowing banks to provide cryptocurrency-related services
like I mentioned According to Japanese newspaper Yomiuri, Japan’s Financial Services Agency (FSA) is considering allowing banks to acquire and hold digital assets such as Bitcoin for investment purposes.
This reform, if passed, would change the banking landscape in the East Asian country. Currently, banks are prohibited from making cryptocurrency acquisitions for the purpose of investments under Financial Services Authority (FSA) guidelines introduced in 2020.
Under the new regulation, banks will be able to trade Bitcoin and other digital assets in a similar way to stocks and government bonds. There will also be certain guarantees to ensure the financial stability of enterprises.
This is not the only base change the Free Syrian Army is looking at. According to the report, the regulator is also discussing allowing banking groups to register as “cryptocurrency exchange operators.” As exchange operators, they will be able to offer digital asset trading and exchange services directly to customers.
The aim of this step is to facilitate the participation of individual investors in the cryptocurrency sector through well-regulated and highly credible institutions.
The reform will be taken up at the next meeting of the working group of the Financial System Council, a government advisory committee under the Prime Minister. It remains to be seen whether the rule will eventually be changed.
In some other news, Beijing has put a roadblock to Hong Kong’s stablecoin plans, according to The Guardian Financial Times. Hong Kong launched its own stablecoin legislative council earlier this year, making it necessary for institutions seeking to issue fiat cryptocurrencies in the region to obtain a license from the Hong Kong Monetary Authority (HKMA).
Many high-profile names such as Ant Group and JD.com have lined up to register with the HKMA, and the first batch of licenses are expected to arrive next year. However, the tech giants appear to have now put their plans on hold after Chinese regulators urged them not to go ahead, raising concerns about the rise in privately controlled currencies.
While China continues to be cautious about stablecoins, the rest of the world is moving forward with adopting these digital assets, including other Asian countries. According to a report released on Friday, three major Japanese banks are preparing to issue a yen-backed token before the end of the year.
Separately, a previous report in August indicated that four major financial institutions in South Korea were in talks with Tether and Circle, the issuers of the two largest stablecoins, USDT and USDC.
Bitcoin price
Bitcoin saw a jump of about 3% over the past day, and has rebounded back above the $110,600 mark.
The price of the coin has made recovery from its recent plunge | Source: BTCUSDT on TradingView
This increase in Bitcoin was accompanied by about $139 million in liquidations on derivatives exchanges.
The liquidation heatmap for the crypto market | Source: CoinGlass
Featured image by Dall-E, CoinGlass.com, chart from TradingView.com
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