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Investment Funds Will Be Allowed To Hold Crypto Under New Legislation in Japan: Report

Investment Funds Will Be Allowed To Hold Crypto Under New Legislation in Japan: Report

If newly proposed legislation passes, Japan will start allowing investment funds to hold digital assets. According to a new Bloomberg report, the administration of Japan’s Prime Minister Fumio Kishida is proposing revised legislation that lifts a restriction that prevents investment funds and venture capital firms from directly holding cryptocurrencies. Says the proposal, which was approved […]

The post Investment Funds Will Be Allowed To Hold Crypto Under New Legislation in Japan: Report appeared first on The Daily Hodl.

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Japan’s SBI looks to Saudi Aramco as it continues Middle East expansion

They have signed a memorandum of understanding on digital asset investment and semiconductor production.

Japan’s SBI Holdings financial services firm and Saudi Arabian state-owned oil company Saudi Aramco are considering teaming up on digital asset investment and semiconductor production projects. The sides signed a memorandum of understanding (MoU) on cooperation that includes the establishment of SBI Middle East in Riyadh as a base for operations in that region. 

According to the MoU, signed Dec. 7, SBI and Saudi Aramco will consider collaborating in the field of digital assets and co-investing in their digital asset portfolios. They may identify Japanese digital asset startups that could be interested in expanding to Saudi Arabia and launch semiconductor production projects in both countries. In addition:

Saudi Aramco is the world’s second-largest corporation by revenue, after Walmart. The MoU mentioned Saudi Aramco investments aimed at complementing its supply chain. Cryptocurrency is “not recognized by legal entities” in Saudi Arabia, although the government has shown a healthy interest in Web3. SBI Holdings’ partnership with Taiwan-based Powerchip Semiconductor Manufacturing was also highlighted.

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Circle Partners With Investment Giant SBI Holdings Amid ‘Full-Scale Introduction of Stablecoins’ to Japan

Circle Partners With Investment Giant SBI Holdings Amid ‘Full-Scale Introduction of Stablecoins’ to Japan

Payments platform Circle is collaborating with a Japanese financial giant as the nation gears up for a full-scale introduction of stablecoins. In a new press release, Circle says that it will be partnering up with SBI Holdings as a means of introducing its stablecoin USDC and other web3 services into the Japanese market after the […]

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Average value of undeclared crypto in Japan dropped 19% in 2022

The number of tax evasion cases featuring crypto assets rose 35% in 2022.

According to Japan’s tax authorities, the average value of undeclared income in crypto fell by 19% in 2022.

On Nov. 24, the Japanese National Tax Agency (NTA) released its yearly summary of tax investigations. The 13-page document also contains data on the probe into crypto tax evasion.

Related: Circle and SBI Holdings partner to boost USDC circulation in Japan

The NTA initiated 615 investigations into citizens’ crypto holdings based on their tax declarations for 2022, up from 444 in 2021. In 548 cases, the agency found tax violations, a 35% increase over 2021, which had 405 crypto tax evasion cases.

However, the average value of undeclared crypto holdings dropped from 3,659 Japanese yen (around $245,000) in 2021 to 3,077 yen ($206,000) in 2022.

In the summer of 2023, Japanese regulators, including the NTA and the Financial Services Agency (FSA), confirmed that citizens would be spared from a capital gains tax on unrealized gains in crypto. That means they will not have to pay around 35% of taxes on those crypto assets stored without trade operations during the fiscal year.

This month, Japan joined a list of almost 50 nations that pledged to “swiftly transpose” the Crypto-Asset Reporting Framework (CARF), a new international standard on the automatic exchange of information between tax authorities, into their domestic law systems.

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Standard Chartered’s venture arm to set up crypto fund in UAE

SC Ventures will establish a “Digital Asset Joint Venture” investment company in partnership with a Japanese financial conglomerate, SBI Holdings.

SC Ventures, the fintech investment arm of British bank Standard Chartered, will establish a “Digital Asset Joint Venture” investment company in the United Arab Emirates (UAE) in partnership with a Japanese financial conglomerate, SBI Holdings. 

In the press release from Nov. 9, Alex Manson, the CEO of SC Ventures, revealed the new joint venture company’s goals:

“[...] to make strategic and minority investments in areas such as market infrastructure, risk management and compliance tools, DeFi, tokenization, consumer payments, and the metaverse.”

Manson highlighted the region’s new role as a hub for fintech due to its strengthening infrastructure and talent. However, the joint venture will not limit itself to the regional market but “explore the emerging digital asset ecosystem opportunities globally.” 

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In May 2023, Standard Chartered signed a memorandum of understanding with the Dubai International Financial Centre (DIFC), granting the bank approval to launch digital asset custody services for its institutional clients worldwide.

Last month, another joint venture by Standard Chartered and SBI Holdings — institutional cryptocurrency custody platform Zodia — launched its services in Hong Kong. Established in 2021, the platform supports 38 cryptocurrencies and has recently opened services in Japan, Singapore and Australia.

Diving deep into the crypto custody business, Standard Chartered has not been neglecting the other side of the digital economy. In June, the bank teamed up with PricewaterhouseCoopers China to produce a white paper on applications for central bank digital currency in the so-called Greater Bay Area of China, which includes Guangdong province, Hong Kong and Macao.

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Progmat stablecoin platform takes shape as wallet, liquidity providers join

Progmat Coin hopes to issue yen- and dollar-pegged “trust-type” stablecoins next summer to accommodate around-the-clock settlement.

The Progmat Coin ecosystem is taking shape in Japan. With a market maker, wallet provider and cryptocurrency exchanges on board, Progmat and Mitsubishi UFJ Financial Group (MUFG) hope to launch two stablecoins in the summer of 2024.

Stablecoin platform Progmat Coin, MUFG and wallet provider Ginco have begun a study with the goal of issuing a yen-denominated XJPY stablecoin and dollar-denominated XUSD stablecoin, Progmat said in a statement. This is in addition to the platform's function enabling stablecoin issuance.

Liquidity provider Cumberland and crypto exchanges Bitbank and Mercoin also figure into the Progmat plans, and other crypto asset-related businesses are invited to join. Binance Japan announced in September that it was conducting a joint study with MUFG on the issuance of stablecoins pegged to various currencies.

Related: Japan to allow startups to raise funds by issuing crypto instead of stocks: Report

The XJPY and XUSD stablecoins will beintended to improve the efficiency of settlements between crypto asset exchanges, with XUSD for use in cross-border settlements. Japanese crypto exchanges use banks for settlement, according to the Tokyo Fin Tech blog, causing delays that the Progmat system will eliminate.

MUFG introduced the Progmat platform in February 2022 in a consortium with other large Japanese banks. It is regulated under the revised Payment Services Act that came into effect in June 2023. The revised act provides for three types of stablecoin. Progmat would support the “trust” type coin, issued by trust banks.

Progmat Coin schematic. Source: Medium

MUFG said in June that Progmat would be used for banks to issue stablecoins on Ethereum, Polygon, Avalanche and Cosmos. Only banks are allowed to issue stablecoins under Japanese law, and stablecoins on Progmat will be required to undergo licensing ahead of launch.

Progmat Coin is not working in a vacuum. Blockchain startup Soramitsu is exploring a new stablecoin exchange for cross-border payments to Asian countries using Camboodia’s central bank digital currency as well as stablecoin. Tokyo-based startup G.U. Technologies is also reportedly creating a stablecoin platform.

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G7 countries to launch AI code of conduct: Report

The Group of Seven (G7) countries will agree on a voluntary AI code of conduct for companies developing AI to reference for mitigating risks and benefits of the technology.

The Group of Seven (G7) industrial countries are scheduled to agree upon an artificial intelligence (AI) code of conduct for developers on Oct. 30, according to a report by Reuters. 

According to the report, the code has 11 points that aim to promote “safe, secure, and trustworthy AI worldwide” and help “seize” the benefits of AI while still addressing and troubleshooting the risks it poses.

The plan was drafted by G7 leaders in September. It says it offers voluntary guidance of actions for “organizations developing the most advanced AI systems, including the most advanced foundation models and generative AI systems.”

Additionally, it suggests that companies should publicize reports on the capabilities, limitations, use and misuse of the systems being built. Robust security controls for said systems are also recommended.

Countries involved in the G7 include Canada, France, Germany, Italy, Japan, the United Kingdom, the United States and the European Union.

Cointelegraph has reached out to the G7 for confirmation of the development and additional information.

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This year’s G7 took place in Hiroshima, Japan, with a meeting held between all participating Digital and Tech Ministers on April 29 and 30.

Topics covered in the meeting included emerging technologies, digital infrastructure and AI, with an agenda item specifically dedicated to responsible AI and global AI governance.

The G7’s AI code of conduct comes as governments worldwide are trying to navigate the emergence of AI with its useful capabilities and concerns. The EU was among the first to establish guidelines with its landmark EU AI Act, which had its first draft passed in June.

On Oct. 26, the United Nations established a 39-member advisory committee to tackle issues related to the global regulation of AI.

The Chinese government also launched its own AI regulation, which began to take effect back in August.

From within the industry, the developer of the popular AI chatbot ChatGPT, OpenAI, announced that it plans to create a “preparedness” team that will assess a range of AI-related risks.

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Stocks across Asia and Europe rise on Economic growth indicators

Stocks across the Asia Pacific region marked a second consecutive day of bullish growth as the European stock market reached a three-week high.

Stock markets in the Asia-Pacific region and Europe saw gains on Thursday. This uptick was attributed to the United Kingdom’s economic recovery, China’s recent stimulus measures and expectations surrounding the United States Consumer Price Index.

The Hang Seng Index in Hong Kong led a positive movement in the Asian markets. The Oct. 12 rise came after reports that China’s sovereign wealth fund increased its investment in some of the country’s major banks.

In Europe, the stock market rally was bolstered by data from the United Kingdom, with reports showing economic growth in August, although some sectors still lagged.

China led bullish stock rally in Asia

China’s sovereign wealth fund announced an increase in its holdings in the country’s four largest banks on Thursday, Oct. 12. The news helped shares of all three main lenders in the country go up during Shanghai’s trading hours. Bank of China stock increased by 3.2%, the China Construction Bank saw an increase of 2.7%, the Industrial and Commercial Bank of China registered a 2.5% gain, and the Agricultural Bank of China jumped 0.6%.

China’s stimulus decisions also helped Hong Kong’s Hang Seng Index rise by 1.9% to 18,257 points for the day, marking the sixth consecutive day of gains for the benchmark index — its longest winning streak since November 2021.

Hong Kong Hang Seng Index daily price chart. Source: investing.com

Japan’s Nikkei 225 index recorded another 1.8% gain on Thursday to reach 32,494.66 points, marking its second consecutive day of gains

Japan Nikkei 225 index daily price chart. Source: Investing.com

European stocks three-week high led by London

The British economy rose 0.2% in gross domestic product terms in August compared to the previous month, exceeding estimates of less than 0.1%. This GDP growth helped reverse a slide in the economy that began in July with a 0.5% contraction.

The bullish economic growth for the U.K. helped European stock markets rise to a new three-week-high. The benchmark London stock FTSE 100 Index rose 0.8%, the French CAC 40 was up 0.6% and the pan-European Stoxx 600 traded 0.8% higher on Thursday.

Vintage Markets is dedicated to the in-depth exploration and reporting of traditional financial news, tracing the journey of global markets and economies from the Stone Age to the Stoned Age.

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Japanese yen-backed digital currency, DCJPY, to go live in July 2024

A group of Japanese companies, united behind the DeCurret brand, intends to launch the coin in July 2024.

On Oct. 12, DeCurret Holdings published a White Paper on the digital currency project DCJPY. The group of Japanese companies intends to launch the coin in July 2024.

According to the White Paper, the DCJPY network will consist of two areas: the Financial Zone and the Business Zone. The former will include banks, minting bank deposits as digital currency on the blockchain, while the latter will be reserved for transactions. The Business Zone will provide space for issuing non-fungible tokens (NFT), security tokens (ST), and governance tokens (GT).

Related: Japan to allow startups to raise funds by issuing crypto instead of stocks

The leading issuer of the DCJPY, backed by deposits in Japanese yens, will be the Aozora Bank, the commercial entity with 19 domestic branches in Japan. In 2021, DeCurret reported about a consortium of 70 Japanese companies that would participate in the DCJPY network. While the White Paper doesn’t mention any specific names of the network participants, DeCurret itself is backed by 35 shareholding companies, with such prominent names as Japan Post Bank, Mitsubishi and Dentsu Group among them. 

DeCurret will hold a seminar on the White Paper explaining the main points behind the project on Oct. 18. The meeting will take place in Tokyo and won’t be screened online.

In May 2023, the Bank of Japan (BOJ) released the results of the second phase of its central bank digital currency (CBDC) experiment. It will make a final decision on the issuance of a “digital yen” by 2026.

Meanwhile, Binance, Mitsubishi UFJ Trust and Banking Corporation (MUTB) are exploring the issuance of Japanese yen and other foreign currency-denominated stablecoins in the country.

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