Sony, Toyota, and Other Giants Enter Blockchain, Industry Participants Call for Japanese Government to Ease Regulations
Sony Joins Japan's Blockchain Push, Testing Regulatory Waters
Entertainment giant Sony Group Corp. is the latest Japanese company to join the growing trend of utilizing blockchain technology, posing a challenge for the Japanese government. Last month, Sony officially launched its L2 network, Soneium, hoping developers will use it to create applications enhancing its products. This is an ongoing project aimed at integrating Soneium with gaming, music, and movies, generating potential opportunities.
Other Japanese companies exploring various blockchain initiatives include Nippon Telegraph & Telephone Corp., Toyota Motor Corp., and Mitsubishi UFJ Financial Group, Japan's largest bank, which is considering issuing a stablecoin.
The Japanese government faces a dilemma: whether to heed the calls from the crypto industry to relax stringent regulations, reducing costs and boosting growth. Under Prime Minister Fumio Kishida, who supports Web3, regulators have indeed taken steps to make it easier for digital tokens to be listed on crypto exchanges. However, his term is ending, and it remains unclear if any hopeful successor will also back Web3 or further regulatory adjustments.
A major concern for industry participants is the high tax rate on crypto assets, reaching 55%, compared to the standard 20% for traditional investment earnings. “Regulators always need time to adapt to new business models, and success requires long-term investment of time and resources,” said Angela Ang, senior policy advisor at blockchain intelligence firm TRM Labs. However, she added that Japanese officials' "increasingly innovative policy inclinations" help explain why companies like Sony are experimenting with digital ledgers.
Japan introduced stablecoin rules in 2023 and established a crypto trading framework. Singaporean crypto lending firm Amber Group sold its Japanese digital asset trading platform to a Sony subsidiary last year. Before the sale, Amber’s managing partner Annabelle Huang described Japan as a "very high-quality market, but highly regulated." (Bloomberg)
