Japan will be ‘Crypto El Dorado’
Japan dreams of becoming a “powerhouse” of crypto and Web3, South Korean analysts and experts believe – but some think Seoul still has what it takes to surpass Tokyo.
Per Chosun Ilbo, South Korea's largest newspaper, Seoul-based crypto companies are concerned about the Japanese government's active Web 3 adoption policy.
These policies have the power to turn Japan, South Korea's political and economic rival, into a “crypto and Web3 El Dorado,” the newspaper wrote.
As South Korea seeks to tighten its grip on the sector following a series of controversies, Tokyo appears to be moving in the opposite direction.
Japan's cryptocurrency regulations remain the most restrictive in the world.
But Prime Minister Fumio Kishida seems interested in controlling certain sectors of the market.
In recent months, Japan's self-regulatory crypto exchange bodies have begun to relax their strict token listing policies.
The government has begun reforming restrictive crypto tax laws that critics say will drive Japanese companies away.
The media wrote:
“While South Korea, once regarded as a powerhouse in virtual assets, is declining due to government regulations and investor reluctance, Japan is on the rise. The government is taking the lead in implementing support measures.” [for the sector] and simplifying regulations”.
Chosun Ilbo noted Kishida's decision in July to present a video speech at the WebX conference in Japan.
The conference was hosted by CoinPost, Japan's largest crypto-focused media outlet.
But Kishida was not the only high-profile government official to speak at the conference.
The country's Minister of Economy and the Chairman of the Policy Research Council of the ruling Liberal Democratic Party also spoke at the event.
Also on the bill are Changpeng “CZ” Zhao, head of Binance, and “Bitcoin Jesus” Roger Ver.
Japanese Government Crypto, Web3 Sector – Will S Korea Follow?
Kishida first revealed his plans for Web3 in May 2022 at a meeting with investors in London.
The following month, he made a number of Web3 commitments, along with a framework of “fundamental policies” due in November 2022.
The LDP set up the Web3 and NFT task forces, which began pushing for tax reform in December last year.
But Chosun changed the Web3 policy in 2010. It followed at the 2021 Cabinet meeting, when ministers agreed to “provide substantial support to Web3 companies” to foster start-ups and boost digital transformation.
The media said Japan has fast-tracked tax reforms and stable coinage laws.
Japan's banks and trust operators were given legal permission to issue and circulate the stablecoin in June.
Meanwhile, South Korean companies are waiting for a stable coin green light.
As a result, overseas cryptocurrency-related companies are “jumping” to do business in Japan, the outlet wrote.
These companies include crypto exchange giant Binance, the stated outlet, as well as South Korean gaming titan Netmarble.
Binance successfully joined the Japanese crypto market sector in August 2023, following an M&A deal with a local startup.
South Korea's “government and politicians” should “pay more attention to growing the domestic market and easing regulations,” experts said.
An unnamed South Korean crypto industry official said,
“South Korea is taking its time, fixing its crypto assets, Japan is moving forward quickly with its government and politicians working together.”
The official concluded.
“South Korea is more competitive than Japan in the cultural content space due to the popularity of K-pop and Korean dramas. If the government encourages rapid legislation, support and regulation, it won't take long for us to gain leadership in the Web 3 sector.”
In recent months, Japanese companies including Mizuno and Casio have announced plans to join the Web3 and NFT platforms.
