As per Japan’s local news agency JIJI Press, Japan is all set to introduce a new set of Initial Coin Offerings(ICO) regulations.
While investing in ICOs come with many pros and cons, however, having rigid regulatory will help in prevent investors from fraud.
According to the news agency, the business operators that conduct ICOs will have to go through a registration process with the Financial Service Agency(FSA) of Japan.
The registration process is similar to security tokens that are registered with the U.S. Securities Exchange Commission(SEC), companies that look to issue their digital currencies for investments need to be registered with the FSA.
The FSA is planning to submit bills to the Japanese Parliament, which revises the current financial law of Japan; the session is to start on January 1. The reason for this is mainly because of the rise in ICO scams that have shaken the crypto space in recent times.
The laws and regulations will not only protect against the rise of ICO scams but would also impact the way ICOs operate in Japan.
In 2017, The FSA Study Group on Virtual Currency Exchange conducted a meeting for an ICO discussion, during the meeting it classified tokens into three different categories:
- Virtual currencies without an issuer
- Virtual currencies with an issuer
- Virtual tokens with an issuer who is compelled to share their revenues legally.
As per a report, the first two tokens are considered to be under the settlement category such as the Financial Instruments and Exchange Act. The third token is under the investment law such as the Financial Instruments and Exchange Act.
ICOs around the world
US Congressman Warren Davidson has over and over again expressed interest in barring the Securities Exchange Commission from having any jurisdictions either over Blockchain or ICOs.
In the UK, lawmakers have expressed their interest in building a regulatory structure for both cryptocurrencies and ICOs. The Government of Rwanda is entirely in support of the blockchain technology for it to manage the country’s land title system.