If the newly proposed legislation is passed, Japan will begin allowing mutual funds to hold digital assets.
According to a new Bloomberg report, Japanese Prime Minister Fumio Kishida’s government is proposing revised legislation that would lift a restriction that prevents mutual funds and venture capital firms from directly holding cryptocurrencies.
The proposal, which was approved by Kishida’s cabinet on February 16, says:
“Actions will be taken to add crypto assets to the list of assets that can be acquired and held by investment limited partnerships (LPS).”
An LPS is generally a fund that invests in unlisted companies and startups.
The proposal is expected to be submitted to the Diet, Japan’s parliament, for debate and vote.
The legislative move is reportedly part of Kishida’s broader efforts to revive Japan’s economy, including supporting Web3 companies. The proposal adds to Japan’s recent decisions to relax some of its strict rules on crypto token listings and taxes, according to Bloomberg.
Hiro Kunimitsu, CEO of Japan-based virtual reality gaming company Thirdverse, to call to action the proposal “great.”
“To explain this simply, under Japanese rules, VCs (venture capitalists) could not invest in crypto assets until now. Some projects only issue crypto assets without issuing shares (Astar, Oasy, etc.). Japanese venture capital funds would not be able to invest in such places. Therefore, from the beginning, the project faced a huge hurdle in sourcing foreign venture capital sources. I think the fact that Japanese VC firms can now invest will be a great opportunity for many Web3 startups to be born from Japan!”
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