Stablecoins have become quite the word on everyone’s lips ever since the infamous Terra (Luna) crash. Governments around the world have started to take measures to protect investors from similar scenarios happening again, and it seems that Japan has become the flagship of these, Bloomberg confirms.
Just today, the Japanese government passed a bill that defines stablecoins as digital assets and therefore demands them to be backed by the Japanese yen or another legal tender. In practice, it means that stablecoins in Japan can now only be issued by licensed banks, trust companies, and registered money transfer agents.
The new piece of the legislature does not account for already existing asset-backed stablecoins from overseas, such as TetherUSD and others.
The bill will come into full force exactly one year from now. Japan’s Financial Services Agency has revealed that it plans to be rolling out gradual regulations that will be addressing stablecoin issuers over the next few months.
Thus, the land of the rising sun will become one of the first major global economies to introduce a legislative framework around stablecoins and basically define them as digital assets.