TLDR:
- Japan has approved VC investment in crypto-only projects.
- Japanese venture capital firms can now directly invest in crypto assets.
Japan has approved a proposal allowing venture capital firms in the country to make direct investments in projects exclusively focused on cryptocurrencies. This decision follows an announcement by the Ministry of Economy, Trade, and Industry stating that the Cabinet has decided to include crypto assets in the list of assets that investment business limited partnerships can acquire and retain. Japanese venture capital entities can now directly invest in crypto assets, signifying a significant departure from previous restrictions. These updated regulations are poised to boost the financial backing and involvement of Japanese venture capital firms in projects exclusively centered on cryptocurrencies. This shift reflects an increasing recognition of the significance and potential of digital assets within the Japanese investment sector.
The Japanese government plans to submit a draft amendment to the parliament, with discussions and potential implementation expected as early as 2024. Japan has never banned the use of cryptocurrencies but has cautioned its nationals on the potential risks associated with unlawful activities and cybersecurity breaches. The country has established regulations to ensure that crypto exchanges operate transparently and securely, providing greater protection to investors. The market volume of cryptocurrencies in Japan is projected to grow significantly between 2024 and 2028, reaching US$2613.0 million in 2028.
