Japan is quite different from the rest of its Asian neighbors. China, for instance, already made the necessary steps to curb the use of cryptocurrencies. In September, the People’s Bank of China has already stopped digital currency trading platforms from operating in the country.
On the other hand, in Japan, there are already 10,000 businesses that are accepting Bitcoin as payment. There are also many young investors being seduced by the possibility of instant and large profits. Though Haruhiko Kuroda, governor of Bank of Japan, mentioned that the rise of Bitcoin’s price is “abnormal”, there are many reasons to why Japan has been embracing cryptocurrencies while other Asian countries are regulating these assets.
Dubbed as Miss Bitcoin on social media, Mai Fujimoto has been known as one of the most prominent names in Japan’s cryptocurrency world. According to her, “I convert all my disposable income into cryptocurrency”. She also mentioned that she has converted to Bitcoin since 2012 after seeing how expensive it is to send money abroad while working for an online donation platform.
She mentioned that “I was impressed when I heard that I don’t have to go through banks if I use bitcoin payment”. She first bought her first Bitcoin in 2012 for just $10 (1,200 yen) in 2012.
Well-Versed Traders in Japan
Though many Japanese investors are known for their risk-averse behavior, it is important to note that they are also well-versed traders especially when it comes to foreign exchange. Yuko Kano, founder and chief executive of bitFlyer mentioned that a lot of ordinary Japanese people are into trading “high-levels” of money on foreign exchange. And this could translate to why many are also into Bitcoin trading.
According to a report from Deutsche Bank, a lot of these Japanese are stay-at-home foreign exchange day traders. And now, they are looking to try Bitcoin.
Aside from having a good number of well-versed day traders, Japanese investors have also been affected by both domestic and international coverage that Bitcoin has been getting especially over the last few months.
Issues Concerning Bitcoin in Japan
But of course, just like anywhere in the world, Japan also experienced its share of cryptocurrency related problems. In 2014, a Tokyo-based exchange platform MtGox has filed for bankruptcy mainly for losing money amounting to almost half a billion dollars’ worth of digital currency. The reason behind it is theft.
In addition to this, there are also some regulations in Japan that can make some potential investors hesitate towards investing in Bitcoin. For one, profits arising from Bitcoin can be considered “miscellaneous income”. This means that profits are subject to higher tax rate amounting to 55%.
One of the main concerns today is the possibility of traders having difficulty calculating their profits. And this could become a problem in the future since it can lead to tax evasion case.
Japan has embraced blockchain technology. And compared to its other Asian neighbors, Japan is definitely ahead of the curve when it comes to adoption of cryptocurrencies in their daily transactions. Will this continue to be a trend or will Japan eventually regulate digital currencies?