Ryozo Himino, the newly appointed commissioner of the Japanese Financial Services Agency (FSA), has recently voiced his concerns over the regulatory slack on cryptocurrency trading.
“Deregulating bitcoins and other cryptocurrencies may not necessarily promote technical innovation, if doing so simply increases speculative trading,” Himino told Reuters.
Japan is one of the major crypto trading markets and its authorities are also lenient on digital currencies. The FSA, however, is keenly monitoring cryptocurrency exchanges operating on the country following the Coincheck hack in early 2018.
Crypto exchanges also need to obtain an FSA license before initiating operations in the country.
Himino highlighted that the regulator is not taking any “special steps” to promote cryptocurrency tradings.
Central banks must concentrate on CBDCs
However, the market watchdog remains bullish on central bank digital currency (CBDC), and the commissioner even pointed-out the benefits of such a digital currency.
“Japan must think really hard about whether to issue CBDCs because there are merits and demerits to doing so. What it can do now is to be ready so that when Japan decides to issue CBDCs, it can do so straight away,” he said.
The Bank of Japan is actively working on the development of digital yen and has recently speeded up the process by setting up a committee to oversee the complications.
The central bank is also a member of a consortium of several other top global monetary regulators from the United Kingdom, Canada, and Europe to study the feasibility and challenges of launching a digital currency.
Himino’s voice echoes the current regulatory mainstream optimism and concerns with the CBDC.
Meanwhile, the South Korean central bank has started piloting its CBDC, but was clear that it has no current plan to launch one. The process is just an initiative to ready itself for any future urgency.
“We shouldn’t be worrying about various challenges [of issuing a CBDC] without even trying to design a plan,” Himino added.
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