When it comes to cryptocurrency in Asia, one of the biggest players is undoubtedly Japan. The country is considered one of the better crypto hubs on the continent, especially when compared to places like China. As the race for global crypto supremacy continues to heat up, more eyes will inevitably be on Japan. But what exactly is the state of crypto in Japan? And what trajectory is the country on?
One of the first things to note is that crypto is widely used in Japan. There are 3.72 million crypto wallets in Japan as of 2022. And this only seems to be growing as the Blockchain Association of Japan claims that this figure is closer to 6.8 million as of 2023. Either way, cryptocurrency has been embraced by Japanese consumers.
And this large user base has not gone unnoticed by crypto companies, many of whom are opening up shop in Japan or expanding their offerings. Some major projects that operate in Japan include SushiSwap and bitFlyer. Just recently, Binance announced the launch of its Japanese arm with 34 tokens available for spot trading before bumping this number up to 100. Some of these tokens include Bitcoin (BTC), Ethereum (ETH), Binance Coin (BNB), Cardano (ADA), and Dogecoin (DOGE).
It is also worth looking into current crypto regulations in Japan. While cryptos are not legal tender or issued by the central bank, they are permitted for use and some commercial Japanese banks have embraced crypto’s underlying technology. Crypto use in the country falls under the jurisdiction of several agencies such as the Japanese Financial Services Agency (FSA). All exchanges that want to operate in Japan have to register with the FSA and follow all of its guidelines. Crypto income is classified as “miscellaneous income” by Japan’s National Tax Agency and the amount to be paid depends on how much was made through crypto. However, crypto income made from mining and DeFi lending, or trading must be reported to the agency and tax must be paid on it.
And what cryptos are Japanese people buying into? Currently, tokens like XRP and Bitcoin are favoured in Japan, as are others like Ether and Dogecoin. This is mostly unsurprising as these tokens are globally known and have a plethora of use cases. And while there are smaller tokens like MonaCoin that are very popular in Japan, the top tokens still dominate the market.
When Japanese people hold these cryptos, they use them for a wide variety of purposes. Several businesses like Mezzo in Tokyo, Mint, T’s Kitchen, and Dot Raw accept cryptocurrency for their products and services and this fits right in with Japan’s crypto-loving population. Then there is cryptocurrency gambling, which has really taken off in the last few years. Online casinos like those featured in updated lists on business2community.com are increasingly accepting cryptocurrency. In fact, there is a growing crop of online casinos that only accept crypto for placing bets. And as more Japanese people are embracing crypto, we can only expect these to become more popular.
Japan also looks to be making more strides in supporting the crypto industry on an institutional level. Just a few weeks ago, it was reported that Japan would begin allowing companies to raise funds using crypto instead of stock, which is good news for firms operating in the country.
Japan has shown itself to be a welcoming country for the crypto industry thus far and if it continues on its current trajectory, it can achieve even more in the next few years.