The Japanese government cites volatility and regulatory limitations for declining Senator Hamada’s Bitcoin reserve proposal.
No Bitcoin in Japan’s Reserves
Japan has officially declined the proposal to adopt Bitcoin as part of its foreign exchange reserves. In a Dec. 20 response to Senator Satoshi Hamada, the government cited volatility and limited understanding of cryptocurrency as key reasons for its decision.
Lack of Global Alignment and Knowledge
Senator Hamada urged Japan to follow other countries exploring Bitcoin reserves. However, the government stated it lacks adequate insight into international movements in this space and considers discussions on the matter to be in preliminary stages.
Legal and Regulatory Barriers
Japan’s legal framework does not classify cryptocurrencies like Bitcoin as foreign exchange assets or securities. The Payment Services Act requires crypto exchanges to register with the Financial Services Agency, and unregistered operations face criminal penalties.
Focus on Stability and Liquidity
The government emphasized its preference for foreign exchange reserves that prioritize safety and liquidity. Bitcoin’s price volatility conflicts with these priorities, further solidifying its stance against adopting the cryptocurrency for reserve purposes.
Future Considerations for Crypto ETFs
While the Japanese government resists Bitcoin reserves, discussions about introducing cryptocurrency-backed exchange-traded funds (ETFs) continue. Akihiko Ogino, CEO of a Japanese investment bank, suggested ETFs as a viable path forward, though no concrete plans have been disclosed.
Broader Implications
Japan’s rejection of Bitcoin reserves highlights its cautious approach to cryptocurrency adoption, focusing on stability and regulatory compliance over rapid innovation.
Disclaimer:
The information provided on 13Desk is for informational purposes only and should not be considered financial advice. We strongly recommend conducting your own research and consulting with a qualified financial advisor before making any investment decisions. Investing in cryptocurrencies carries risks, and you should only invest what you can afford to lose. 13Desk is not responsible for any financial losses incurred from your investment activities.
