Japanese Financial Services Agency to regulate issuance and brokerage of stablecoin linked to Japanese yen

Nikkei Asia, the international edition of the Nihon Keizai Shimbun , reports that the Financial Services Agency of Japan will regulate the issuance and mediation of stablecoin backed by the Japanese yen and allow it to be issued only to banks and the fund transfer business.

Stablecoins to face new restrictions in Japan --Nikkei Asia
https://asia.nikkei.com/Spotlight/Cryptocurrencies/Stablecoins-to-face-new-restrictions-in-Japan

Japan puts new restrictions on stablecoins --The Verge
https://www.theverge.com/2021/12/6/22821188/japan-puts-new-restrictions-on-stablecoins

Japan to Propose Limiting Stablecoin Issuance | PYMNTS.com
https://www.pymnts.com/cryptocurrency/2021/japan-to-propose-limiting-stablecoin-issuance/

Stablecoin, which is a type of digital currency, realizes price stability by issuing coins with legal currencies such as US dollars and Japanese yen and specific cryptocurrencies (virtual currencies) as collateral and fixing the exchange rate. It is a virtual currency. However, if there are not enough reserves for issuance, price stability can be disrupted and the financial markets can be severely impacted. According to the U.S. Treasury Department, the total issuance of Stablecoin in 2021 amounted to about 141 billion dollars (about 16 trillion yen) as of the end of November 2021, toward the regulation of stablecoin that will achieve rapid growth. It was reported that the US government is also collecting information.

US government starts collecting information to regulate stable price virtual currency Stablecoin --GIGAZINE

The Bank of Japan is proceeding with a demonstration experiment of digital currency, and from April 2022, the second stage will be advanced centering on exchange for cash and cooperation with private payment systems. It is also reported that a digital currency backed by bank deposits may be issued within 2022.

Digital Currency Forum to Demonstration Experiment of Private Digital Currency within This Year | Reuters
https://jp.reuters.com/article/digital-currency-forum-idJPKBN2I90BA

According to the Nihon Keizai Shimbun, the issuers of stablecoin are limited to banks and fund transfer companies, and the intermediaries responsible for transaction and management of stablecoin are also subject to supervision, as well as user identification and crime. Money laundering measures will be strengthened, such as requiring reporting of suspected transactions.

The Nihon Keizai Shimbun has been investigated by the Justice Ministry for the fact that the US dollar and the corresponding stablecoin tether are 'suspicious that half of the reserve is a risk asset such as commercial paper' in the background of the tightening of regulations of the Financial Services Agency. Pointed out that there are times. The Financial Services Agency is also concerned about the possibility that the issuer of Stablecoin will go bankrupt and destabilize other financial markets as a result, and that users will be anxious and will try to cash Stablecoin all at once. The Nihon Keizai Shimbun says that it does.