The Japan Virtual and Crypto Assets Exchange Association (JVCEA) is in talks to decide whether to jettison its current cryptocurrency token screening procedures, Bloomberg reports.
JVCEA currently requires local cryptocurrency exchanges that want to list new tokens to undergo a screening process.
However, this could change soon, private sources told the outlet.
According to sources, JVCEA could begin to focus instead on policing cryptocurrencies and tokens after they are listed.
However, this new approach will not apply to initial coin offerings, sources further told the outlet.
The self-regulatory body is looking to make a definite decision with regards to the change before the end of 2022, the anonymous sources added.
However, a source within Japan's Financial Service Agency told the outlet that it was not clear whether the financial industry watchdog will approve JVCEA’s recommendations.
The new development comes after Japanese Prime Minister's (Fumio Kishida) administration expressed dissatisfaction with the current system of listing digital assets in the country.
Kishida last month criticized JVCEA for taking too long in its pre-screening procedures.
Moreover, the news comes on the heels of Japan’s recent passage into law, a bill that defines stablecoins as digital money and sought to entrench investor protection.
Crypto Regulation in Japan
In March, Japan announced that it was introducing a green list of cryptocurrencies that could be listed in a-go on exchange.
The goal was to simplify the process of listing new cryptocurrencies on exchanges in the country.
Also, Huobi, one of Japan’s most popular cryptocurrency exchanges and part of the Huobi Group, last month disclosed that Japanese citizens will be able to start trading Bitcoin Satoshi's Vision (BSV) this month.
With the move, BSV, the native cryptocurrency of Bitcoin Satoshi's Vision (BSV) will become the 15th cryptocurrency on Huobi Japan.
In 2021, Japan’s Financial Services Agency (FSA) established a new unit to oversee digital currency regulatory frameworks.
Citing three anonymous officials, Reuters had reported at the time that the move followed the country’s concern over the influence of private money on the existing financial system.
Japan has always been a progressive country when it comes to crypto adoption and regulation.
Some of the earliest cryptocurrency exchanges were established in the East Asian country and have led the market in Bitcoin trading for many years.
However, crypto regulations in the country underwent a major overhaul in 2019 after a massive attack on the country’s leading crypto exchange, Coincheck, which resulted in the theft of more than $500 million worth of digital currencies.
