On 2nd March, JVCEA – the Japan Virtual Currency Exchange Association, the Japanese virtual currency self-regulatory board released admission information of three new companies who joined in as class 2 members of the association. As per the records, Tokyo Hash Co., Ltd., Digital Asset Markets Inc., and Coinbase Inc. are the new additions in the association.
This is not the first time Coinbase has wanted to spread its influence in Japan. Back in 2019, talks on obtaining a license were “going well” with Japan’s Financial Services Authority. The US-based digital currency exchange said that Japan’s strict inspection of the crypto industry is an advantage. Indicating the company’s assurance in securing regulatory approval.
Japan has progressive regulations around cryptocurrency exchanges. They are legal to trade and run. Due to the infamous Coincheck hack of $500M, Japan made it a point to tighten its security, narrowing pathways, allowing only secure, legitimate exchanges to participate.
Japan is seen as a digital money haven for its enormous pool of retail financial investors and light-contact government strategies, however administrative and regulatory supervision has expanded as of late in the midst of the progression of prominent crypto hacks. Coinbase’s enrolment was thoroughly watched over, as per reports as the company’s entry in the Japanese market is a green signal towards the development of international companies in Japan.
What does this mean for Coinbase?
The Japan Virtual Currency Exchange Association- JVCEA, is a part of Article 87 of the Law Concerning Fund Settlement with Virtual Currency Exchangers as Members. It is a certified fund settlement business association with three types of membership classes.
- Class 1: Cryptocurrency exchanges
- Class 2: Businesses applying for or planning to apply for virtual currency exchange registration
- Class 3: TBD [Waitlisted]
This means Coinbase can now apply to become a regulated Japanese cryptocurrency exchange.
As part of the effort to accelerate the global adoption of cryptocurrency, Coinbase launched its office in Japan back in 2018. Under the leadership Nao Kitazawa [CEO at Coinbase, Japan] the new office was made to “lay the foundation for Japan’s crypto investors” and to access a range of Coinbase’s products.
As observed, the class 2 membership with JVCEA will also be represented by Nao and his team.
Coinbase has been eyeing the Japanese market and has been open about its plans for a while now. Back in 2016, Coinbase and Bank of Tokyo-Mitsubishi UFJ [BTMU] formed a strategic partnership to support “Coinbase’s long-term international expansion efforts”. BTMU is the largest bank in Japan and a subsidiary of the Mitsubishi UFJ Financial Group [MUFG].
Coinbase is not the only giant trying to make a mark in the Japanese crypto market, a couple of months ago the messaging giant LINE was granted a crypto exchange license in Japan. Some on-going famous regulated exchanges in Japan are Quoine, Bitflyer, Bitbank, SBI VC Trade, GMO Coin, Huobi Japan, Btcbox, Bitpoint Japan, and Tech Bureau. It was also reported that Japan has one of the largest cryptocurrency trader base of around 3.5 million active investors.
