Japan is now developing blockchain innovations through a new regulatory sandbox system under the Cabinet Secretariat of Japan and this incubation process seems not to have enough of blockchain ideas.
An Empty Field Without Players
Back in June 2018, the Japanese government introduced the sandbox regime to instigate the introduction of new business ideas and innovative technologies. As startups and organizations both within and outside Japan can apply, the incubation allows developing with new technologies such as blockchain, artificial intelligence, and Internet of Things (IoT) in areas such as financial services, transportation, and healthcare.
The Mission Statement
The purpose of this system, experiments of which take place in virtual spaces and unlimited in the geographical region, however, is to confirm whether the new business is applicable and would work in real market situations. After the government evaluates the results of these trials, it plans to introduce deregulation measures.
According to Hirohiko Nakahara, a counselor in the Economic Revitalization Bureau of Japan’s Cabinet Secretariat,
“Our sandbox regime is open to everybody and we try to make it possible for everyone to experiment as fast as possible, ”…“We must prove there’s a social benefit and that a new business is acceptable and practicable. The important thing is to make our market attractive.”n
According to the report, the sandbox has so far approved six projects for experiments involving a broad range of business propositions since its launch. One major trial was put forward by Panasonic, an Internet of Things (IoT) in which home appliances would be tested using Power Line Communication (PLC). This is a technology that would allow data to be sent via already existing power lines.
As anyone might expect, Sandbox also opens the door of opportunities to Fintech. Tokyo-based crypto finance firm, Crypto Garage which looks at how to advance settlements between digital currency exchanges focused on developing trustless financial services based on bitcoin and blockchain technology.
Crypto Garage made an impressive display of idea and was chosen for the sandbox program due to its incredible settlement system called SETTLENET and its plans to develop the business in Japan and overseas.
Crypto Garage registered itself for the sandbox regime because Japan lacked a regulatory body for the new business model. Having gotten a 1-year experimental period, Crypto Garage hopes to take the technology abroad after reporting its results to the Cabinet Secretariat and calculating its potential economic value.
“I think the Japanese market is very interesting,” says Okuma. “The government is very progressive in promoting new financial systems under the regulatory sandbox. We have talented technology resources internally and we’re trying to match these with Japan’s progressive policies to expand the range of financial solutions.”