According to a Monday report by Bloomberg, Katsunobu Kato, Japan’s finance minister, has stated that cryptocurrencies could serve as a means of diversification.
Even though the nascent asset class is rather volatile, it could be “part of diversified investments” within a proper framework.
The ministry will focus on creating an appropriate trading environment for crypto.
The Liberal Democratic Party (LDP), the ruling party of the world’s fifth-largest economy, has already pledged some important reforms when it comes to crypto.
Firstly, the party has pledged to move digital assets to a separate flat tax regime (roughly 20%). As of today, individual cryptocurrency gains are being taxed with a progressive rate of up to 55%. If the LDP makes good on its promise, this could be a major development for the local cryptocurrency market.
Secondly, the LDP would also introduce equities-style insider trading rules for crypto that would prohibit nefarious actors from profiting from insider trading information, such as token listing plans and protocol changes.
Following multiple major hacks, the LDP supported strict crypto regulation since digital assets were seen as risky. Japan became one of the most regulated cryptocurrency markets.
Under former Prime Minister Fumio Kishida, the party moved to embrace Web3, aiming to retain tech talent.
In the meantime, Metaplanet, the biggest corporate holder of Bitcoin in Japan, has been recently added to the FTSE Japan Index, which is a market-cap weighted index of large and mid-cap equities from the country.
CEO Simon Gerovich has also announced that the company has acquired an additional $11.7 million worth of BTC, which brings its total holdings to nearly $2 billion.
