In the latest move to boost the growth of crypto investment products in Japan, a consortium of Japanese companies has recommended that any future exchange-traded funds (ETFs) in the region should focus on Bitcoin (BTC) and Ethereum (ETH).
The recommendation comes as Japan argues that it should follow the US and other nations that have already approved crypto-backed ETFs.
Push For Crypto ETF Approval
It is no longer news that the recent launch of crypto ETFs in the US and other major countries such as Hong Kong is seen as a milestone in the digital asset industry, following years of regulatory resistance.
Despite accepting the crypto ETFs found in these countries, Japan, on the other hand, has been cautious so far in this regard, with officials from the Financial Services Agency (FSA) previously expressing doubts about the benefits of these ETFs.
However, since October 25, a group, which includes prominent financial institutions, appears to be pushing and urging the country’s regulator to prioritize Bitcoin and Ethereum ETFs because of their “market value and long-term performance” that make them “well suited.” ” asset creation in the medium to long term.
In particular, the group’s proposal highlights the perceived credibility of Bitcoin and Ethereum, pointing to their track records, as well as significant market caps, which are key players in the digital currency market as a whole.
As Japan explores a possible change in its stance on crypto ETFs, the alliance appears to ensure a focus on well-established assets like Bitcoin and Ethereum.
Recommendations for Tax Reform and Regulatory Review
In addition to recommending that Bitcoin and Ethereum be prioritized in a possible ETF offering, the coalition advised that Japan review its tax policies on crypto income.
Japan’s tax rate on crypto profits can be as high as 55%, which many say is a deterrent for individual or institutional investors.
The group suggested that tax breaks on cryptocurrencies could help make Japan a more “competitive place” for digital investment.
Notably, members of this alliance include key players in the Japanese financial scene, such as Mitsubishi UFJ Trust and Banking Corp., Sumitomo Mitsui Trust Bank Ltd., crypto exchange bitFlyer Inc., and trading firms such as Nomura Securities Co. and SBI Securities Co.
These institutions with extensive industry experience have collectively expressed their concerns and recommendations as consensus rather than individual opinions.
Details of the alliance come as Japan’s digital currency regulatory landscape is under close scrutiny, and the FSA has confirmed its intention to review its regulatory policies. However, this review is expected to take time and its outcome remains uncertain.
The featured image was created with DALL-E, a Chart from TradingView
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