REGULATION

Web3 startups raising funds through new coin offerings see dawn approaching? Japan's Cabinet approves new law, awaiting parliamentary review for enforcement

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Web3 startups raising funds through new coin offerings see dawn approaching? Japan

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Japan's Cabinet Approves New Crypto Funding for Startups, Pending Parliamentary Review

Last September, the Japanese government announced plans to adjust regulatory frameworks to allow startups to raise funds by issuing digital assets to investors, enabling these companies to offer cryptocurrencies instead of traditional assets like stocks during fundraising.

According to a report by Nikkei Asia, the bill has now received approval from the Cabinet but will need to undergo parliamentary review before officially taking effect.

Japan has historically been conservative in its policies regarding digital assets, and this move aims to diversify the financing methods available to Japanese startups.

The new funding mechanism, called the "Investment Limited Partnership Fund," will apply to multiple criteria for startups issuing securities.

Content reported by Nikkei Asia

Financing Challenges Eased, Japanese Web3 Startups See Dawn of Hope

Hiro Kunimitsu, founder of Japanese blockchain game developer Gumi, pointed out that under current Japanese regulations, venture capital funds cannot invest in crypto assets, making it a significant barrier for Japanese crypto projects to secure funding domestically, forcing them to seek funding from foreign venture capitalists.

The changes brought by the new law represent a tremendous opportunity for many Japanese Web3 startups.

Japan Continues to Promote Crypto Regulation

While Japan has been traditionally conservative in its approach to crypto policies, recent events such as the FTX bankruptcy have prompted further relaxation of crypto regulations, including the aforementioned expansion of crypto funding options for startups and exemptions for corporate crypto holdings.

  • Is Early Legislation the Key to Maturity? A Look at the Current State of the Japanese Crypto Market Gradual Relaxation Since April This Year

  • Japanese National Tax Agency Eases Crypto Taxation, Conditions Apply for Tax Exemption on "Unrealized Gains" for Companies

  • Japan Passes Stablecoin Bill! Must be Linked to Legal Tender, Ensure Redemption, and Can Only be Issued by Designated Financial Institutions