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Discussion on Stable Coin

A) Current status of Stable Coin in Japan

In Japan, it has been reported that a major bank is planning to issue Stable Coin. The examples of LCNEM cheque, the digital currency of KDDI Group and D-Callet have been reported, but there are considered to be no full-scale examples at the moment.

 

B) Impact after the revision

Although there is no major impact from the implementation of the new laws and regulations, there are still issues that require further consideration. Although there is no major impact from the implementation of the new laws and regulations, there are still issues that require further consideration. Although individual verification is required, we will review the laws and regulations that affect stable coins separately for cases where they are considered to be crypto assets and for cases where they are considered to be  currency-denominated assets.

1. When Stable Coin is considered a crypto asset

If they are considered to be crypto assets, exchange providers that handle stable coins must register as a crypto asset exchange business and are subject to the Amended Payment Service Act. In addition, as a specified business operator under the Act on Prevention of Transfer of Criminal Proceeds, you will be obliged to pass KYC.

2. When Stable Coin is considered to be fiat-currency-denominated asset

If stable coins are regarded as fiat-currency-denominated assets and are used for currency exchange transactions as remittances, then the transfer of stable coins of 1 million yen or less will require registration as a money transfer business (Article 2, Paragraph 2, and Article 37 of the  Amended  Payment Service Act Law, and Article 2 of the Order for Enforcement of the Law Concerning Payment Services Act), and the transfer of stable coins in excess of 1 million yen will require a banking business license (Article 2, Paragraph 1, Item 2, Paragraph 2, and Article 4, Paragraph 1 of the Banking Law).

Reference

Article(How will the Blockchain Industry change with the Amended Payment Service Act enacted on May 1, 2020) from ZeLo on May. 8, 2020

 

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