Japan is considering allowing startups to raise funds from venture capital firms using digital assets, with a plan expected to be presented to parliament next year.
Traditionally, Japan’s venture capital scene has been conservative and risk-averse compared to places like Silicon Valley.
The proposed rule would expand investment options to include digital assets for firms looking to invest in crypto startups. Venture capital’s importance in Japan has been growing, with average funding sizes increasing significantly.
Japan’s tighter crypto regulations are seen as a response to criticism it received two years ago for lagging in implementing digital asset rules. Recent regulations include investor protection for stablecoins and anti-money laundering rules for cryptocurrencies.
Additionally, Japan introduced new anti-money laundering rules for cryptocurrencies in June, obliging individuals and companies to trace the origin of specific assets and identify both senders and recipients.
In March of the previous year, the country pursued amendments to its Foreign Exchange Act aimed at restricting crypto transactions that were suspected of benefiting sanctioned Russian individuals.
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