Japanese authorities may decide to lift the ban on foreign stablecoins

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In June, Japan became one of the first significant nations to create a stablecoin legal framework. Six months later, the Financial Services Agency (FSA) is taking yet another crucial step to modify the current ban as it works to lift the ban on foreign-issued stablecoins.

Which tokens will be made available is still a mystery. The USDC and USDT coins from Tether and Circle are anticipated to return, though. The new stablecoin regulation is reportedly expected to be implemented in 2023, according to a report by the regional news agency Nikkei.

To preserve their value, distributors rather than foreign issuers will be responsible for managing stablecoins under the new regulations. Under the conditions of asset preservation through deposits and an upper limit of remittance, the country’s digital asset exchanges will be able to handle stablecoin trading.

The FSA has suggested a cap of 1 million yen (or $7,500 per transaction) on the amount that can be sent using these stablecoins.

On the other hand, the issuer of locally minted stablecoins will need to get ready assets as collateral. In addition, the Japanese stablecoin market only allows banks, fund transfer services, and trust companies to be issuers.

As part of anti-money laundering (AML) measures, the FSA will require stablecoin distributors to record transaction details such as user names. The financial regulator also intends to start gathering comments on suggestions for its proposed stablecoin guidelines.

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