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SBI Group Introduces Blockchain-Based Money Transfer Service Between Japan And Vietnam

SBI Ripple Asia recently announced that it has joined hands with SBI Remit to provide money transfer services between Japan and Vietnam using blockchain technology. Of course, the two Japanese companies are working with a local Vietnamese bank – Tien Phong commercial joint-stock bank, for making the transfer in fiat currency.

SBI Group is the holding company that controls SBI Ripple Asia and SBI Remit as separate subsidiaries. While SBI Remit provides international money transfer services to clients, SBI Ripple Asia provides distributed ledger technology and blockchain-based fintech solutions to clients.

Blockchain is changing money transfer

According to the latest report, Vietnam’s Tien Phong Bank (TPBank), SBI Ripple Asia, and SBI Remit have just introduced the first money transfer services between Vietnam and Japan using RippleNet distributed ledger technology.

The CEO of Vietnamese TPBank, Nguyen Hung said that their partnership with SBI Ripple Asia on the use of blockchain technology in cross-border money transfer marks a significant turning point in enhancing their customer experience. He further recognized that the application of blockchain makes an international money transfer via TPBank safer, more convenient, and faster than ever before.

Nguyen disclosed that transactions are now being processed faster while ensuring cash flows, transparency, and safety are legally transferred via foreign banks to Vietnam. He explained that transactions at TPBank are ensured to comply with all foreign and domestic regulations and anti-money laundering laws.

On the other hand, Yoshitaka Kitao – a representative of SBI Group – praised the progressive stance that TPBank has made towards adopting cutting-edge technologies. He mentioned that SBI Ripple Asia is intending to adopt RippleNet to provide remittance services of crypto-assets in the future. He added that such adoption will further distinguish the firm from its competitors.

Meanwhile, RippleNet blockchain is a trusted platform network that many payment providers, financial institutions, and banks use to speed up remittance transactions. RippleNet platform is a preferred choice because of its existing relationships with other banks across the world. Ripple is aggressively expanding in global markets. Recently, the firm partnered with Finastra in the UK to allow its customers to access cross-border payments services using RippleNet.

The SBI Group eyes Vietnam market

Yoshitaka identified the booming Vietnamese economy as one of the most attractive markets across the world. The SBI Group owns a 19.9% share of TPBank and invested in the bank since 2009. TPBank has steadily accumulated non-interest income and loans like settlement services, by actively deploying cutting-edge technologies.

In 2017, TPBank became one of the top banks in Vietnam with assets more than $5.3 billion. The bank focuses on e-banking and digital transformation and has a money transfer app that enables customers to send money with a QR code.

Japan has a huge number of Vietnamese populations who live in the country. The number increased 4.57 times over the last five years to reach over 330,000 by 2018.

SBI has been keen to see potential opportunities in untapped markets. No wonder, the company has rushed to launch the first money transfer services between Vietnam and Japan.

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Japanese University Integrates Blockchain for Tamper-Proof Academic Records

The Muroran Institute of Technology, located in Hokkaido, Japan, is piloting a blockchain initiative to authenticate its students’ academic records.

As reported by the Nikkei Asian Review on Dec 3, the Japanese university has collaborated with Nippon Telegraph and Telephone West Corporation for the blockchain program expected to begin by March 2020.

BarnardSoft Co. Ltd is also expected to render its service of system development as the project progresses.

Junichi Kishigami, a professor at Muroran Institute, noted: “We hope to eventually have a system that also tracks job histories and qualifications, so each person can easily prove their records.”

Muroran Institute is set to be the first Japanese university to incorporate blockchain technology into the verification of academic records, but five others are expected to follow suit in 2020.

Maintaining authentic academic records is proving to be a daunting task, as many universities merge. As a result, blockchain technology is continuously being deployed in many institutions of higher learning for immutable storage across the globe.

For instance, as reported by Blockchain.News on Nov 21, following concerns raised by the US Embassy that some employees and students were applying for visas using fake academic certificates, the Indian state of Telangana made a broad move of addressing this menace by deploying blockchain in academic certificates granted by Jawaharlal Nehru Technological University Hyderabad (JNTUH).

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What Does the Japanese FinTech Landscape Look Like?

Tokyo, the capital of Japan has been ranked as one of the top 12 FinTech hubs in the world by Deloitte’s A tale of 44 cities: Connecting Global FinTech: Interim Hub Review 2017. The Tokyo Metropolitan Government (TMG) created policy outlines to form the city with the vision of an unrivaled global financial center.

The TMG also launched an Accelerator Program, FinTech Business Camp Tokyo to allow foreign startups with new emerging technologies and business models to come to Tokyo to expand their business. Regulators have also been encouraging FinTech innovation by establishing new laws around blockchain, cryptocurrencies, and APIs. Changes to the Banking Act has made it more convenient for financial institutions and FinTech companies to offer services using APIs. The legal status of virtual currencies has been clarified as the first in the world by the amendment of the Payment Services Act. Blockchain.News spoke with three representatives of three different associations, to find out more about the Japanese FinTech ecosystem at the Asian Financial Forum (AFF).

FinCity Tokyo

FinCity Tokyo, short for Global Financial City Tokyo is an organizationaimed for the promotion of the financial industry and the FinTech industry based in Tokyo, which started last year.

Kazuhiko Yoshimatsu, the General Manager of the Global Financial City Tokyo said, “We are promoting the FinTech industry at the moment, large Japanese financial institutions wat to have cooperation with FinTech companies that have very good technologies and Tokyo.”

FinCity Tokyo is looking to match the needs between big companies and large institutions, including listed corporations. Yoshimatsu also hopes that “Asian authentic companies can bring innovation to the Japanese industry.”

FinTech Association of Japan

The FinTech Association of Japan is a non-profit organization,enabling an ecosystem of Japanese FinTech startups, helping members to find solutions in Japan and help their business to expand outside of the country

According to Takeshi Kito, the Vice-Chairman, and Head of Global Partnership at the FinTech Association of Japan mentioned that the association has collaborations with Japanese regulators, including the Financial Services Agency (FSA) and it has also signed a Memorandum of Understanding with the FinTech Association of Hong Kong and with Hong Kong Internet Finance Association. With more than 20 partners in the world, the association has reached agreements with partners in Singapore, Denmark, and Chile.

Kito added that the FSA has been making waves in the crypto and blockchain regulations, however, he believes the regulator is “too strict” in terms of FinTech innovation.

FINOLAB

FINOLAB, set up in Japan, is an industry base to supportthe growth of FinTech startups. With a physical office with 50 startups together to promote innovation, the organization also focuses on connecting startups. They connect large financial institutions and startups to expand the FinTech ecosystem in Tokyo.

Most of the members of FINOLAB is also a member of the FinTech Association. They also have a mentor group called Finnovators, where they give advice to FinTech Association, as well as the FINOLAB members. There is a big overlap between the two organizations, where they also co-host FinTech meetups.

Japan was one of the first countries to introduce regulation in crypto, although since then, the regulator has experienced hurdles with exchanges getting hacked and fraud cases. “At that point, the FSA didn’t have sufficient monitoring resources, but they have been learning a lot and have been increasing the teams. They have a fairly sophisticated monitoring team to follow the blockchain and cryptocurrency exchanges,” said Makoto Shibata, Chief Community Officer at FINOLAB.

Japan Aims to Curb the Potential Influence of China’s Digital Currency With Help From the US

Aiming to curb the potential influence of China’s digital currency electronic payment, its nation’s central bank digital currency, Japan is looking to release its own digital currency proposals today. According to Prime Minister Shinzo Abe, the country is also requesting support from the US Federal Reserve.

Norihiro Nakayama, the Vice-Minister for Foreign Affairs in Japan and the top member of the Liberal Democratic Party, the ruling party that drafted the proposals, said that he wishes the “Federal Reserve would partner with six other central banks including the Bank of Japan in studying digital currencies.”

As the US Dollar remains the world’s dominant currency, Nakayama added, “We sense the digital yuan is a challenge to the existing global reserve currency system and currency hegemony. Without the US, we cannot counter China’s efforts to challenge the existing reserve currency and international settlement system.”

Nakayama predicted that with the Belt and Road initiative, which includes a digital economic framework, the digital yuan is highly likely to become the standard of the digital economy.

The former head of financial settlements at the Bank of Japan, Hiromi Yamaoka said an interview that China is the competitor; “if the yuan is used more widely than the yen, it will lead to a decline in Japan’s economic power and influence in the mid to long term.”

This update came in just less than a day after the Federal Reserve Governor Lael Brainard said the reserve is looking to research on central bank digital currencies. He further suggested that the Federal Reserve is changing its attitude towards the possibility of a Fed digital currency.

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Tables Turn for Japanese Man After Being Convicted for Secretly Installing a Crypto Mining Program

The Tokyo High Court has dismissed the acquittal of a 32-year-old Japanese man who had been let off the hook by the Yokohama District Court in March 2019 after being accused of unlawfully inserting a cryptocurrency mining program dubbed Coinhive. The high court reversed the previous ruling as it found him guilty of secretly inserting and using Coinhive on visitors’ computers upon visiting his website without their permission or knowledge.

Coinhive operated for malicious gains

The court noted that the man who is a website designer ran the Coinhive program for egocentric motives as he did so without the consent or awareness of visitors. As a result, he operated it for personal gain, and his action was concluded to be a malicious crime that got him fined 100,000 yen, approximately $910.

Tsutomu Tochigi, the presiding judge, acknowledged, “Visitors were not informed of (the mining program) or given the chance to reject it.”

It is alleged that the website designer installed the Coinhive program on his site between October and November 2017. His indictment occurred in March 2018, but he was not detained.

In March 2019, the Yokohama District Court freed the website designer because it noted that Coinhive did not have significant effects on the visitors’ computers. It also stated that investigators had not cautioned him against the usage of the program before charging him.

The Tokyo High Court was, however, of a contrary opinion because it stipulated that these factors were not substantial for acquittal.

Nevertheless, the website designer depicted his displeasure with the ruling as his lawyer revealed that he could appeal.

According to a Cipher Report, as of November 2019, the cryptocurrency sector had lost a whopping $4.4 billion in thefts and scams. It is the reason why concerns are raised about secretive crypto mining programs, such as Coinhive.

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Coinbase Takes a Step Further into the Japanese Crypto Market

Coinbase has been licensed in Japan since 2019 and has registered as second-class members of the Japan Virtual Currency Exchange Association (JVCEA), a self-regulatory organization for the crypto industry in Japan.

Along with Coinbase, Digital Asset Markets, and Tokyo Hash have also registeredas second-class members according to the JVCEA. Joining as second-class members with the agency allow the companies to be registered as crypto exchange companies.

Coinbase has also previously partnered with the Bank of Tokyo-Mitsubishi UFJ as a part of Coinbase’s expansion into Asia.

The cryptocurrency exchange also launched Coinbase Custody in 2017 for institutional clients such as hedge funds and family offices. Its assets under management have over $7 billion in cryptocurrency assets, with its acquisition of Xapo’s institutional custody business in August 2019.

The international launch of Coinbase Custody

The international launchof Coinbase Custody is said to meet the demands of institutional investors in Europe and beyond. Due to client demand, the company expressed that Europe is its fastest-growing geographic segment. The company is planning to support more digital assets in the future, along with new features.

Coinbase was awardedan e-money license in October 2019 in Ireland by the Central Bank of Ireland and has allowed the company to expand its Irish operation and “deliver a better product to its customers across some of their fastest-growing markets. It will also enable them to secure passports for their customers across the EU and EEA.”

The Japanese fintech market

Tokyo, the capital of Japan has been rankedas one of the top 12 FinTech hubs in the world by Deloitte’s A tale of 44 cities: Connecting Global FinTech: Interim Hub Review 2017. The Tokyo Metropolitan Government (TMG) created policy outlines to form the city with the vision of an unrivaled global financial center.

Blockchain.News spoke with three representatives of three different associations, to find out more about the Japanese FinTech ecosystem at the Asian Financial Forum(AFF), including FinCity Tokyo, FinTech Association of Japan, and FINOLAB.

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Japan Rural Dwellers to Experience the Use of Blockchain in Property Acquisitions

A new platform has shown through trial methods that the Japanese real estate fund was more efficient, transparent, and compliant with the use of digital securities and blockchain technology.

The details of the experiment were published in a Medium post on March 10. Securitize Inc., a company with aims to modernize capital markets by creation of digital securities, which are easier to own, simple to manage and faster to trade, in partnership with LIFULL Co Ltd (with funding from LIFULL Social Funding Co Ltd), recently announced the successful creation of a funding platform which will support the use of digital securities for investing in real estate. The platform’s aim is to help promote real estate crowdfunding to revitalize vacant homes in the countryside of Japan.

LIFULL Co Ltd is credited with launching the project in partnership with BUIDL, Ltd. and LIFULL Social Funding Co., Ltd. in December 2019, Securitize Inc. soon after acquiring BUIDL continued with the commitment of BUIDL as regards the development of the platform alongside LIFULL to implement the first phase of the project which was already considered to be satisfactory.

In the course of carrying out the project, the companies were able to successfully prove that crowdfunded real estate funds using digital securities and blockchain technology was more practical and showed operational cost reductions in comparison to the traditional structure.

Pleased with the outcome of the partnership, Carlos Domingo, CEO and Co-Founder of Securitize Inc. said, “Our collaborative success in creating a comprehensive platform solution for crowdfunded real estate funds is very exciting, and it is a great start for Securitize and LIFULL as we work to modernize the Japanese real estate market together.”

With the new partnership, blockchain will continue its adoption process in Japan and other sectors would tap into its unlimited benefits.

In recent times the real estate industry has seen an increase in the application of blockchain. One of in amongst these numerous cases happened earlier on as a blockchain company based in Switzerland had sealed a real estate deal worth $134 million.

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What are the New Amendments in Japan’s Crypto Laws to be Enforced Next Month?

Japan will be enforcing new cryptocurrency-related regulations in May, as two of the pieces of legislation were passed by the Japanese House of Representatives last year. The Payment Services Act (PSA) and the Financial Instruments and Exchange Act (FIEA) were originally scheduled to come into effect in April, however, there has been a delay and the final enforcement date has been officially pushed to May.

In May 2019, the Japanese House of Representatives amended the cryptocurrency-related laws, and revised the term “Virtual Currency” to “Crypto Asset,” as it would be a more accurate term to describe cryptocurrencies. This change came into effect as the use of the term “virtual currency” may cause confusion to the public as cryptocurrencies function or hold the same value that is associated with fiat currencies. Although this term is amended by law, it is not compulsory that exchanges or the media follow suit.

Crypto exchanges expected to manage crypto differently

Crypto exchanges operating in Japan are expected to manage customers’ crypto separately from the exchanges’ reserves. Exchanges will need to find a third-party operator to hold customers’ funds in custody by a trust company or a similar entity.

Crypto exchanges will also need to use reliable methods for storing customers’ funds, such as cold wallets. If the exchange wishes to use hot wallets, they must hold the same quantity of crypto assets as the customers’ crypto assets to be able to reimburse them in case of any losses.

Yes or no to anonymous crypto and privacy coins?

The revised regulation did not mention the regulation of anonymous cryptocurrencies and privacy coins including Monero and Zcash. The Financial Services Agency believed that it would first handle problematic crypto assets that are more commonly used for money laundering purposes as transaction records are not made available.

However, the FSA is planning to regulate this area of the crypto industry, as the bill has the inclusion of anonymous cryptocurrencies.

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Researchers of Japan’s Blockchain-Based Digital Court Face Backlash Due to its Decentralized and Unregulated Nature

Researchers in Japan have been looking into a blockchain-based mechanism to settle legal disputes in a “digital court,” aiming to perform legal actions with a more cost-efficient legal process.

Professor Hitoshi Matsushima, from the University of Tokyo, and Shunya Noda from the University of British Columbia have been leading the project, as the University of Tokyo stated that this is an extension for existing decentralized smart contract development.

The University has faced some backlash from the press regarding the technology’s decentralized and unregulated nature, and there was concern that the digital court would receive “bad press” as well. Blockchains in some ways are a double-edged sword, although this kind of system signals the dawn of a new economic paradigm that must be embraced and explored rather than feared and ignored, said Matsushima.

Further explaining the design of the blockchain-based mechanism, he said, “On suspected violation of some agreement, those involved post their opinions to this digital court. The court algorithmically aggregates the parties’ opinions and judges who violated their agreement. If the digital court judges that a party violated the agreement, the party is fined by withholding a deposit made during the initial agreement.”

Blockchain technology is mainly used to maintain the records of the parties’ involvement with agreements. Matsushima said that the digital court could be built on current blockchain platforms such as Ethereum, and that “it could happen right now.”

Japan’s new cryptocurrency laws to be enforced next month

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Japanese Advertiser Dentsu Offers Influential Manga Comic Critics Blockchain Rewards

Japanese advertising behemoth, Dentsu has partnered with Kadowkawa ASCII Research Labs to help local content creators on popular streaming apps to gain recognition and have their work critiqued by the public.

According to an article on April 20 by Nikkei, the partnership centres around establishing a Proof of Concept (POC) for rewards to independent content creator using blockchain. The goal is to offer blockchain rewards to popular commentators of Japanese Manga comics who leverage the livestream apps.

Japanese Manga Has Some Copyright Issues

Manga comics are synonymous with Japanese culture but the famous art form has its own copyright issues. Japanese consumers often sell on comics and some books are sold on multiple times especially if they are collectible, however the author only receives commission on the first sale.

The popularity of these comics has fostered a rich history of secondary creators, fans who often create content based on original works of anime, manga and their central characters. While the intentions of these creators are usually to express their appreciation or love for a comic, copyright laws are often breached especially when it comes to some manga commentary videos.

Dentsu and Kadokawa aim to make it easier for people using livestream with potentially copyrighted material by using blockchain. The partnership is designed to explain the range of allowed materials on these platforms to these secondary and even tertiary creators.

“We want to incorporate the activities of fans that have not been converted into monetary value into the legitimate content market,” said Junichi Suzuki, who is heading the blockchain trial at Dentsu.

Japan’s government has shown a heightened interest in preserving their own content. The Ministry of Economy,Trade and Industry in Japan also set up program in 2019 with the aim of providing companies with an interest in managing Japanese creator content using blockchain up to half a million USD.