Japan Proposes Guidelines to Legalize ICOs


Advertisement

Join our community of 10 000 traders on Hacked.com for just $39 per month.

A working group backed by Japan’s government has proposed new guidelines intended to legalize and regulate initial coin offerings (ICOs).

In a report published April 5, Japan’s ICO Business Research Group — a task force that includes lawmakers, academics, bankers, and the chief executive of bitFlyer, Japan’s largest cryptocurrency exchange — called for the government to legalize ICOs and adopt clear industry rules and practices that encourage growth but also protect investors.

“ICO is still in its infancy and has no industry practices yet,” the group wrote. “Appropriate rules must be set to enable ICO to obtain public trust and to expand as a sound and reliable financing method.”

Under the proposed guidelines, ICO operators would be required to perform KYC verification on all contributors.They would also be required to make copious disclosures to ICO contributors and other investors prior to beginning the offerings and regularly update them on how closely the project is sticking to the roadmap laid out in its whitepaper.

Exchanges — perhaps through the newly-formed self-regulatory body — would adopt industry-wide standards on token listing, and insider trading related to ICO tokens would be explicitly classified and prosecuted as such.

The report notes that regulators may have to adopt more detailed rules in the future, including regulations designed to “restrict or encourage certain types” of ICO structures.

According to Bloomberg, the Financial Services Agency (FSA) will consider the proposal as soon as this month, though it may take several years for them to be codified into law.

Once adopted, these rules would likely further cement Japan’s status as one of the world’s leading cryptocurrency and blockchain development hubs, particularly since regional competitors China and South Korea and Japan have — at least to date — taken a hard line against ICOs.

The timing of the report’s release is notable, given that it comes at a time when the FSA has been ramping up its oversight of the country’s thriving cryptocurrency exchange industry. The FSA has issued business improvement orders to a variety of domestic trading platforms, and a handful have already announced that they are unable to comply with the rules and will instead shut down.

Featured image from Shutterstock.

Follow us on Telegram.
Advertisement

Source: https://www.ccn.com/japan-proposes-guidelines-to-legalize-icos/

Leave a Reply 0 comments

%d bloggers like this: