After the collapse of one of the biggest bitcoin exchange websites, Mt. Gox, there were numerous calls for the Japanese government to install regulations and to become an active participant in ensuring consumers are protected. Although the government has investigated the matter, the latest news suggests the government won’t do much else.
Japanese Prime Minister Shinzo Abe – also known throughout the rest of the world of applying Abenomics as a form of stimulus – and his Liberal Democratic Party (LDP) confirmed Thursday it will not be implementing regulations and that no government agency will be in charge of overseeing the peer-to-peer decentralized digital currency.
“Basically, we concluded that we will, for now, avoid a move towards legal regulation,” said Takuya Hirai, an LDP legislator. “While we may need to be flexible in reviewing legislation in the future, we also have to have to stand back and allow this new sprout of industry to grow.”
In addition, the panel also promoted the concept of taxing bitcoin transactions – the number has been pegged at an eight percent sales tax – and capital gains.
Instead, the government is urging the cryptocurrency industry to impose self-regulatory measures in order to protect consumers, investors, websites, retailers and all of the other interested parties, according to a panel brought together by the ruling party.
This has been the recommendation of several bitcoin insiders, too.
“Japan should become the world’s easiest place to run bitcoin businesses and for this reason we must avoid tying down the industry with regulation,” the panel announced in a statement.
Once the local bitcoin community establishes an industry group aimed at consumer protection then it would consult with the ministries of trade and the economy, the Consumer Affairs Agency, the National Police Agency, the FSA and other government bureaus. If the bitcoin community adopts these policies then Japan could very well revamp the entire market and lead the way when it comes to working with bitcoiners.
