Japan Looking to Regulate Bitcoin, Asking for International Cooperation

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Japan Looking to Regulate Bitcoin, Asking for International Cooperation
Japan Looking to Regulate Bitcoin, Asking for International Cooperation

Japan Looking to Regulate Bitcoin, Asking for International Cooperation

As Japanese Bitcoin exchange Mt. Gox is in deep trouble, Japan’s senior regulators are now saying they would seek to regulate Bitcoin. However, they consider that it cannot be done without international support and efforts. In his statement, speaking at a press conference, Senior Vice Finance Minister Jiro Aichi said that if Japan regulates Bitcoin, international collaboration would be necessary.

According to Aichi this type of large-scale coordination is needed to prevent criminals from exploiting loopholes or weak points in international law. Earlier, ForexMinute reported that Manhattan attorney Preet Bharara subpoenaed Bitcoin exchanges including of Mt. Gox to know about the state of affairs and what was being done about addressing the issue of hacking.

The government of the US seems sincere about the way Bitcoin is being handled and the way Bitcoin exchanges are operating. Now, Japanese authorities have taken cognizance and something good will come up for customers who are often uncertain about the services from Bitcoin exchanges that stop their services in between.

Japan has promised that it would intervene “if necessary” to determine what wrongdoing occurred in Mt. Gox. Reports are ripe that Japanese law enforcement officials are looking into the developing Mt. Gox case, along with US regulators. They are also looking into the exchange’s long-term business plans, and mounting evidence that internal financial mismanagement led to the failure.

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A Comprehensive and Multi-Department Inquiry on Its Way

In his press statement Aichi released a few additional details about the actions that could take space. He also promised that as the inquiry proceeds more government agencies could become involved in the investigation. Nonetheless, as Bitcoin does not meet the definition of currency under Japanese law, there are still uncertainties whether and what consequences the inquiry has.

The future is definitely uncertain for Bitcoin if things are seen from here. Aichi says that as for its legal position, a currency (under Japan’s jurisdiction) would be coins or notes issued by the Bank of Japan. At the very least, we can say Bitcoin is not a currency. Any clarification on Bitcoin is expected soon as earlier the Bank of Japan never did any such thing.

The negativity that the failure of Mt. Gox has spread is dangerous for Bitcoin at large as it is no more niches now. A lot of coverage is being given in the mainstream media and the digital currency starting to receive attention from the general public.

To contact the reporter of this story: Deepak Tiwari at deepak@forexminute.com