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Breaking: Japan Allows VCs to Invest In Crypto Tokens

Japan leads the way in crypto innovation, embracing Web3 and offering startups a crypto-powered alternative to stocks for public funding.
Breaking: Japan Allows VCs to Invest In Crypto Tokens

The Japanese government has greenlit startups to utilize cryptocurrency tokens as an alternative to traditional stocks for public funding. This transition, designed to diversify the revenue avenues for budding businesses, is more than just an economic strategy since it signifies Japan’s evolving approach to digital assets and its commitment to fostering Web3 technologies.

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Japan’s Progressive Crypto Approach

Moreover, Japan’s new regulations are part of a broader initiative to remain at the forefront of crypto adoption. Significantly, the country’s Limited Partnership Act for Investment governs this innovative form of equity financing. Under this act, limited liability partners are free to offer shares to unlimited liability partners, thus opening a new era of fundraising.

However, Japan’s proactive stance comes with a historical context. Once the home of Mt. Gox, the largest Bitcoin exchange globally, Japan has matured its crypto regulations. 

Additionally, in early June, Japan introduced stablecoin legislation, allowing banks and trust companies to issue these tokens. Consequently, yen-backed stablecoins have seen a surge in popularity, accumulating $500 billion in transaction volume.

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U.S. Controversy

On the international front, Japan’s approach starkly contrasts with that of the US. While Japanese startups revel in the newfound freedom to raise funds, the US Securities and Exchange Commission (SEC) maintains its stringent stance. 

Ripple Labs, for instance, recently came under fire for its sales of XRP, which, according to a judge, violated US securities law. Besides, the SEC continues its crackdown on projects that sidestep token registration protocols.

While the world grapples with the fast-evolving crypto landscape, Japan is carving a niche, balancing innovation with regulation. As Japanese Prime Minister Fumio Kishida recently reiterated, the nation remains steadfast in its commitment to the transformative potential of Web3. Hence, with Japan’s continuous strides, it’s evident that the country is not just adapting to the digital era but leading the charge.

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Kelvin Munene Murithi

Kelvin Munene is a crypto and finance journalist with over 5 years of experience, offering in-depth market analysis and expert commentary . With a Bachelor's degree in Journalism and Actuarial Science from Mount Kenya University, Kelvin is known for his meticulous research and strong writing skills, particularly in cryptocurrency, blockchain, and financial markets. His work has been featured across top industry publications such as Coingape, Cryptobasic, MetaNews, Cryptotimes, Coinedition, TheCoinrepublic, Cryptotale, and Analytics Insight among others, where he consistently provides timely updates and insightful content. Kelvin’s focus lies in uncovering emerging trends in the crypto space, delivering factual and data-driven analyses that help readers make informed decisions. His expertise extends across market cycles, technological innovations, and regulatory shifts that shape the crypto landscape. Beyond his professional achievements, Kelvin has a passion for chess, traveling, and exploring new adventures.

Why trust CoinGape: CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journalists and analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
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