Bitcoin and other cryptocurrencies to be called “crypto-assets” in Japan: Report

Japan’s Financial Services Agency (FSA) is going to place the names of bitcoin and other cryptocurrencies under a single category “crypto-assets”, The Japan News reported referring to a report from The Yomiuri Shimbun.

An advisory panel to the FSA compiled a report last week highlighting that the term “virtual currency” could be misleading, and urged a change of the term.

By calling all cryptocurrencies crypto-assets, the government hopes that “traders will no longer purchase them believing that they are legal tender recognized by the government,” the report said.

In April 2017, Japan revised its Payment Services Act which requires all cryptocurrency exchange operators to register with FSA. Importantly, it recognized bitcoin as a means of payment in the country.

However, in August 2018, an FSA official told The Japan Times that virtual currencies are outside the Financial Instruments and Exchange Act, adding that trading in them is “unchecked.”

On the basis of the panel’s report, the FSA intends to revise relevant laws and regulations in order to drive the implementation of stricter management systems by the companies engaged in the crypto space. In addition, the panel’s report also highlighted the need to establish a mechanism to protect cryptocurrency users in the event of cash outflows.

At a meeting held earlier this year, finance ministers and central bank governors of the Group of 20 major economies agreed that cryptocurrencies “lack the key attributes of sovereign currencies,” and used the term “crypto-assets” to describe them.