Japanese House of Representatives has passed a new crypto bill including the request for the government to integrate the law. The news was reported by CoinTelegraph Japan on May 31.
The bill, officially entitled as "A draft bill to amend some of the fund settlement laws, etc., in response to the diversification of the financial transactions following the advancement of information and communication technology" was formed by Japan's Financial Services Agency (FSA). The bill was approved by House of Representatives on March 15. Later, it was being passed by most in the House of Councilors plenary session, as per the update today on the FSA's website.
The bill wants to start changes to the two national laws which apply to the crypto assets: the Act on the Settlement of Funds and the Financial Instruments and Exchange Act. As of now, the bill has been passed, the revised acts are anticipated to come into force on June 2020.
Talking about the items the House of Representatives asked the FSA to review is to “Establish an effective inspection and supervision system from the viewpoint of user protection, etc. based on the current situation of crypto assets and [initial coin offering] ICO transactions in recent years.”
Some of the items need the regulator to review real situations and take proper measures as per results along with developing a system which is suitable and consistent with the regulatory trends of G20 and international standards like anti-money laundering measures.
Also, FSA was requested to “Take care not to unduly limit … the development and application of these technologies” while building and deploying rules along with conducting inspections and imposing measures.
Policies as per the ICO were also considered, especially the need for the government to establish guidelines and take appropriate measures while considering international discussions. Provided the diversity ICO participants and types of issues, the agency was asked to avoid “excessive regulation, and respond appropriately as necessary.”
The proposed changes to Japan's financial instruments and payment services laws will seemingly tighten crypto regulation in order to encourage user protection, more effectively manage crypto derivatives trading, reduce industry risks like exchange hacks, and extensively built a highly transparent regulatory framework for the new asset class.
There will also be a legal change in the title given to cryptocurrencies as "crypto assets" from "virtual currencies" as it was being given earlier. Apart from this, there will also be the main change in the rules governing margin trading, where margin will be limited to two to four times the initial deposit.