Japan to Relax VC Crypto Investment Rules: A Major Opportunity for Web3 Startups ๐
The Japanese government is set to change laws regarding Limited Partnership Funds (LPS) in a move that could allow venture capital firms (VCs) to invest in Web3 companies. Currently, LPS operators are not permitted to hold cryptoassets, limiting the funding options for startups in Japan. However, according to an official release from the Ministry of Economy, Trade, and Industry, the cabinet has approved a plan to relax this rule. This decision could revolutionize the way Web3 firms raise funds in Japan and provide a significant opportunity for Japanese startups.
The Cabinetโs Decision: Allowing VCs to Hold Crypto
- The Japanese Cabinet plans to change laws related to Limited Partnership Funds (LPS).
- LPSes are funds that typically invest in unlisted companies and startups.
- Last year, the Ministry of Economy, Trade, and Industry announced plans to allow LPS operators to invest in security tokens.
- In its latest announcement, the ministry stated that it is ready to relax the rule prohibiting LPSes from holding cryptoassets.
- This decision would enable LPSes to acquire and hold cryptoassets alongside other assets.
Web3 projects in Japan have faced challenges raising funds from domestic VCs due to existing regulations. Many startups have been forced to seek investment from overseas VCs. The CEO of Thirdverse, Hiro Kunimitsu, highlighted that this restriction created a significant barrier to entry. However, with the proposed relaxation of VC crypto investment rules, Japanese VCs may finally have the opportunity to invest in cryptoasset-related firms within their own country.
Japanese Governmentโs Plan Underway
- News outlets report that the Japanese government has been planning to relax VC crypto investment rules since September last year.
- A bill is expected to be submitted to parliament sometime this year for approval.
- Historically, proposed crypto legislation in Japan has always received parliamentary approval.
This move by the Japanese government comes as other initiatives in the country, such as creating a virtual city on a metaverse platform and increased scrutiny of crypto-related transfers by financial regulators, demonstrate Japanโs growing interest in the crypto space.
Hot Take: A Game-Changer for Japanese Web3 Startups! ๐ฅ
The decision to relax VC crypto investment rules in Japan presents a major opportunity for Web3 startups in the country. With the ability to attract funding from domestic VCs, these startups can now avoid the hurdle of seeking finance from overseas investors. This move could potentially fuel innovation, growth, and development within the Japanese Web3 ecosystem. As Japan continues to embrace cryptocurrencies and blockchain technology, it solidifies its position as a key player in the global crypto landscape.
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