Japan’s Minister of Economy, Trade and Industry Takeru Saito saying on August 28, 2024, which aims to boost its Web3 ecosystem through startup-friendly tax reforms.
Startup-focused tax reforms are key to Web3 industry growth
To boost its Web3 industry, Japan may soon implement startup-focused tax reforms to facilitate the growth of companies in this sector. Speaking at the WebX Conference, Saito highlighted the huge potential of Japanese Web3 and blockchain companies.
The minister stressed the importance of positive tax reforms to create an ecosystem that attracts companies and property developers from around the world to Japan. Japanese Prime Minister Fumio Kishida echoed Saito’s views.
In a video speech during the WebX 2024 opening ceremony, Kishida stated that Web3 and blockchain companies could play a pivotal role in solving many of Japan’s social problems. With sensible tax and legal reforms, Web3 startups would find it easier to raise funds and help create new avenues for employment in the country.
It is worth noting that in July 2023, the Japan Blockchain Association (JBA) required Japanese authorities will reduce taxes on crypto assets.
Kishida added that the government will work to foster an enabling environment for the use of Web3 tokens, blockchain-based instant payments, and revitalizing the content industry. Future policies around the Web3 industry will have user protection as one of their core principles.
The first signs of a change of stance towards cryptocurrency startups were noticeable In September 2023, when the Japanese government announced Measures that allow start-ups to receive investments in cryptocurrency.
Regulatory hurdles persist in Japan
While the WebX Conference inspires confidence in Japan’s commitment to growing its Web3 industry, regulatory challenges surrounding digital currencies continue to be a concern for the country’s crypto ecosystem.
For example, in July 2024, the main cryptocurrency exchange, gate.io closed its operations in Japan. The exchange stated that it aims to follow financial regulations wherever it does business, which indirectly alludes to the stringent regulations on cryptocurrencies due to concerns about money laundering and terrorist financing.
Japan’s strict regulations on cryptocurrencies are not unfounded. In May 2024, DMM Bitcoin, a major cryptocurrency exchange based in Japan, will be listed on the cryptocurrency exchange’s website.was hackedResulting in a loss of $305 million in Bitcoin (BTC).
On the contrary, if recent events are any guide, institutional appetite for Bitcoin appears to be on an upward trajectory in Japan.
In June 2024, a joint survey conducted by Nomura Holdings and Laser Digital Holdings found that 54% of respondents, including 547 investment managers from family offices and public interest corporations, said they would be interested in entering the digital asset market in the next three years.
Featured image from Unsplash, chart from TradingView
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