Digital Currencies Like Bitcoin Are Now Legal Tender in Japan
The digital currency world is moving forward.
“Bitcoin” of the Realm
After years of ups and downs for Bitcoin and its merchants, this year seems to be looking much better for the digital currency. Earlier this month, Bitstamp announced its acquisition of a license for Bitcoin exchange in the EU starting July 1. And now, the Japanese cabinet has approved the integration of digital currency like Bitcoin into the legal banking system, provided they follow certain regulations with money laundering prevention and consumer protection.
Bitcoin is supposedly a “more stable” currency and payment system, invented by Satoshi Nakamoto, that is “a purely peer-to-peer version of electronic cash [that] would allow online payments to be sent directly from one party to another without going through a financial institution.”
As of now, the legality of Bitcoin varies from country to country. Some countries do not recognize digital currency as legal tender, and some go so far as to ban it altogether.
Its reputation has been tarnished through the years by cases such as individual loss of Bitcoins and irretrievability, with no legal means to obtain compensation for the loss. In Japan, courts dismissed any claims for compensation over loss of Bitcoins due to the fact that virtual currency was “not subject to ownership.”
The biggest case that brought the credibility of Bitcoin down was the legal issues and eventual failure of Mt. Gox, a Bitcoin exchange based in Tokyo, Japan that handled 70% of Bitcoin transactions all over the world before its spectacular fall.
Just Like Any Currency—Up Again
Due to recent innovations in the Bitcoin exchange industry, however, Bitcoin is back in the game. Coincheck, a new exchange, has gained over 1000 merchants and billions of Yen in investments each month.
The recent acceptance of digital currency in Japan may also be attributed to the country’s current economic struggles and the gains Bitcoin and similar currencies could offer in the financial technology industry.
So Bitcoin’s making a comeback in a big way, finally jettisoning an overly ambitious scramble for immediate gains for a steadier, more incremental approach to win acceptance and confidence from users—and those two factors, after all, form the bedrock of any currency.
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