Japan Considers Relaxing Rules for VC Crypto Investments, Opening Doors for Web3 Companies
The Japanese government is considering allowing venture capital firms to invest in Web3 companies by relaxing regulations surrounding crypto investments.
According to an official statement from Japan’s Ministry of Economy, Trade, and Industry, as reported by the media outlet CoinPost, the cabinet has greenlit a proposal that could soon permit venture capital firms to hold cryptocurrencies.
Venturing into Crypto: Japan’s New Frontier?
The proposed changes target laws governing Limited Partnership Funds (LPFs), which typically invest in unlisted companies and startups.
Under the current framework established by the Limited Partnership Act of 1998, LPFs are subject to regulations that dictate their investment activities. Last year, the ministry revealed plans to permit LPF operators to invest in security tokens.
However, the ministry previously stated that it would not authorize LPFs to hold crypto assets. In its latest announcement, though, the ministry indicated a willingness to relax this restriction.
According to reports, the cabinet has reached an agreement to include crypto assets in the list of assets that LPFs can acquire and retain.
Unlocking Opportunities for Web3 Startups
This potential policy shift could revolutionize how Web3 firms secure funding in Japan. Presently, startups are limited to offering shares to venture capital investors, as regulations prevent them from providing LPF investors with cryptocurrencies.
素晴らしい〜！！㊗️
— 国光宏尚 元gumi (Hiro Kunimitsu) (@hkunimitsu) February 16, 2024
これは簡単に解説しますと、これまでの日本のルールだとVCが暗号資産に投資できなかったのです。プロジェクトによっては株式は発行せずに暗号資産の発行だけといのもあります。(AstarやOasyなど)… https://t.co/In6iNagzXm
Hiro Kunimitsu, CEO of Thirdverse, highlighted the challenges faced by Web3 projects in accessing funding from overseas venture capitalists. He noted that this restriction has posed a significant barrier to entry for Japanese startups in the Web3 space.
However, Kunimitsu expressed optimism about the cabinet’s decision, describing it as a significant opportunity for Japanese Web3 startups to thrive.
If implemented, these regulatory changes could mark a pivotal moment for Japan’s venture capital ecosystem, potentially fostering innovation and growth within the country’s Web3 sector.
For more Web3 news, check out the XGA newsfeed.
