Japanese ministers illuminated green on proposals to amend the Payment Services Act, which will facilitate regulation of stable securities companies.
According to a press release issued by the country's financial services agency, the bill has already been approved by the Cabinet and was submitted to the National Diet on the same day. The bill was previously approved by the FSA, which could make it easier for crypto companies to enter the Japanese market.
For the bill to pass the national cabinet, it must receive a majority vote from the Cabinet members who attended the meeting. The Cabinet is led by the Japanese Prime Minister. The Japanese Prime Minister plays an important role in determining consensus as the Cabinet operates under the principle of collective responsibility. Once approved, the bill will be formally submitted to the National Meal for legislative discussion and votes.
Once it is handed over to meals, the bill will be assigned to the relevant committee, where it will be inspected, discussed and potentially amended before it is introduced into the full chamber. If both the House and Councillors approve the bill, it is sent to the emperor for ceremonial promulgation.
What are the potential changes in Japan's crypto regulations?
The bill could be supported by short-term government bonds and time deposits, with the exception of demand deposits alone. The clause also has a 50% cap on government bonds and sediment, which can be used as collateral for stablecoins.
At the time of pressing, Japanese Stablecoin issuers must match the amount of circulation tokens at a 1:1 ratio with the cash deposits in a regulated bank account. The new rules give them more flexibility to allow other assets, such as Japanese and US government bonds, instead. However, you can only use certain types of bonds, including those with maturity of less than three months.
Additionally, the bill creates a new category exclusively for “intermediaries” crypto businesses or brokerage companies. In Japan, cryptocurrency securities companies can operate domestically only if they are able to meet the same registration requirements as cryptocurrency exchange platforms.
This means that Crypto Brokerages will need to apply for a virtual asset service provider license, just like national crypto exchanges. Under the new bill, intermediaries will comply with their own requirements and money laundering obligations, rather than coagulating with exchanges that behave differently.
