Japan will tighten regulation of stablecoins in 2022
According to experts, next year Japanese regulators may propose a number of laws that will take control of stablecoins.
The FSA plans to restrict transactions with stablecoins for banks and companies that carry out electronic money transfers in 2022. We are talking about those stablecoins, the issuers of which do not have a license.
This will prevent Japanese users from using Tether and other stablecoins without a license. The point is that Tether has no legal status. The company is regulated under the laws of the British Virgin Islands.
The lack of a license exempts Tether and other companies from financial reporting. They do not undergo regular audits and inspections by regulators, as they operate as a private company. In the future, however, this could prevent them from scaling to many countries if they follow Japan's lead.
This prospect scares many stablecoin issuers. For example, Circle (issuer of USDC) plans to obtain a US license (register as a cryptocurrency bank) to operate in the Japanese market.
Experts say the crackdown on stablecoins may be linked to government fears that it will negatively affect the future of Japan's CBDC. Recall that the Bank of Japan has planned to issue the e-yen by the end of 2022. It will be named DCJPY and will be supported at launch by 70 companies.