Leader of Japan’s DPP commits to crypto tax cuts ahead of election

Hong Kong Moves to Enable Retail Crypto TradeHong Kong’s Securities and Futures Commission (SFC) has moved to enable retail participation in crypto trading within the Chinese autonomous territory.The SFC has arrived at that determination, according to a report it published on Tuesday. The report, titled “Consultation Conclusions on the Proposed Regulatory Requirements for Virtual Asset Trading Platform Operators Licensed by the SFC (Note 1),” provides an overview of the nature of feedback the Commission received as part of its consultation process relative to virtual asset trading.Photo by Ben Cheung on PexelsRetail investor protectionIn the press release which accompanied the report, the Commission outlined that “a significant majority of respondents agreed to our proposal to allow licensed trading platform operators to serve retail investors.” On that basis, the SFC is moving forward in enabling retail trading of crypto assets through licensed virtual asset trading platforms effective June 1, and it’s setting out to do so while implementing a number of measures to protect retail investors.That will include ensuring that operators provide an appropriate on-boarding process. In the case of crypto asset projects, the SFC is determined to see to it that good governance is implemented, alongside enhanced token due diligence, admission criteria, and disclosures.In the statement, the SFC’s CEO Julia Leung, said that “providing clear regulatory expectations is the key to fostering responsible development.” She added that “Hong Kong’s comprehensive virtual assets regulatory framework follows the principle of ‘same business, same risks, same rules’ and aims to provide robust investor protection and manage key risks. This will enable the industry to develop sustainably and support innovation.”Specific conditionsOne item that the SFC’s new rule-book on virtual asset trading for retail investors outlines is a ban on crypto “gifts.” Effectively any promotions or incentives that lead with free gifts, and this will likely include token airdrops, will be prohibited.In terms of capital liquidity, virtual asset exchanges will be required to maintain a minimum of 5,000,000 Hong Kong dollars ($638,000) at all times as a minimum paid-up share capital. A Platform Operator must at all times maintain liquid capital which is not less than its required liquid capital,” the document outlines.Token due diligenceThe SFC acknowledged that it can be difficult for virtual asset exchanges to carry out due diligence on new tokens. With that in mind, it has incorporated a requirement for any new token to have a twelve-month track record before it can be considered to be listed to provide an indication of such things as supply, demand, maturity, and liquidity. In that way, exchanges have some data to work with in carrying out token due diligence.Smart contracts have been a point of weakness in recent years, with considerable sums lost through hacks that have exploited smart contract code vulnerabilities. To that end, the SFC insists that as part of token due diligence, new assets will have to undergo smart contract audits performed by independent assessors.Given that the spate of recent crypto platform failures implicated loss of customer deposits, the rule-book considers the need for segregation of client funds. Exchanges will need to segregate funds and can either hold them separately from the assets of the exchange itself or have them held in escrow.

Web3 company Carrieverse has partnered with Korea Digital Assets (KODA) to facilitate robust investor protection and safe and transparent trading of virtual assets, according to South Korean news site Money Today on Tuesday (KST).Photo by Kaffeebart on UnsplashEnhancing investor securityRecently, there have been cases where corporate entities have demonstrated unstable management of the virtual assets they hold, particularly where withdrawals and distribution are concerned. Many investors have subsequently suffered losses due to incidents such as hacking. This partnership was established to protect investors from such situations. Carrieverse’s partnership with KODA is aimed at protecting investors from such troubles. The firm plans to safely store its cryptocurrency CVTX in KODA’s custody system, and vowed to boost transparency of transactions and clarify investor protection measures. "Recently, the number of Carrieverse users has exceeded 30,000 per day, and we are seeing an increase in on-chain data and CVTX holders. Our partnership with KODA will provide an environment for transparent cryptocurrency trading and bolster investor protection,” Carrieverse said. About KODA and CarrieverseKODA is a virtual asset custody service provider jointly established by KB Bank, Web3 digital wallet developer Haechi Labs and blockchain investment firm Hashed. It is known for its one-stop digital asset custody services catered to corporate and institutional clients. Carrieverse’s Web3 services include a metaverse, a blockchain gaming platform called Cling and the card strategy role-playing game (RPG) Superkola Tactics, which is playable on Cling.

Japan’s Blockchain Group Requests Crypto Tax Revision for Web3 AdoptionThe Japan Blockchain Association (JBA) has submitted a request to the Japanese government to reform the current cryptocurrency tax system, as it believes the existing framework hampers the growth of the Web 3 industry and discourages public engagement with cryptocurrencies. The association believes the tax revision would help position Japan as a leading country in the Web3 industry and boost the nation’s economy through these changes.Photo by Su San Lee on UnsplashGreater tax exemptionLast month, the Japanese National Tax Agency announced that companies would no longer be taxed on unrealized gains from cryptocurrencies they hold, provided they are the issuers of those tokens. While this represents a positive step, the JBA considers it insufficient in fostering Web3 growth. In light of this, the blockchain group urges the government to extend this exemption to also cover holdings of tokens issued by third parties.Separate taxationAdditionally, the JBA proposes a shift in the tax treatment of personal cryptocurrency transactions. It advocates for a separate taxation approach with a fixed tax rate of 20% for individual transactions, including crypto derivatives. This modification is seen as a way to adapt to the increasing prevalence of crypto asset transactions in the emerging Web3 era.Crypto-to-crypto trading tax abolitionUnder the current system, individuals trading crypto assets for other crypto assets are subject to income tax on the profits earned from each transaction. However, with the increasing variety of crypto assets and the growing prominence of crypto asset transactions in the emerging Web3 era, the JBA is advocating for the abolition of income tax on transactions between cryptocurrencies. The complexities involved in taxing such transactions within the evolving Web3 landscape have prompted the group to propose a reevaluation of the taxation approach, seeking a more favorable environment to foster the growth of the crypto industry.Japan has demonstrated its proactive approach in promoting and embracing the Web3 industry. At the annual Japanese Web3 conference, WebX, held in Tokyo last week, Prime Minister Fumio Kishida delivered a video address to mention Web3 as part of “the new form of capitalism,” acknowledging its capacity to stimulate economic growth and tackle societal challenges. Minister Kishida highlighted the Japanese government’s dedication to creating a supportive and conducive environment for the advancement of Web3 projects.