The Japanese government is speeding to enforce new stablecoin laws within the aftermath of the Terra collapse.
Japan is moving forward with legislation regarding the issue of stablecoins, i.e., digital assets with their worth pegged to edict currencies or stabilized by an algorithm.
On Friday, Japan’s parliament passed a bill to ban stablecoin issue by non-banking institutions, native news agency Nikkei reported.
The bill reportedly stipulates that the issue of stablecoins is limited to licenced banks, registered cash transfer agents and trust corporations in Japan.
The new legislation also introduces a registration system for money institutions to issue such digital assets and provides measures against hiding.
According to the report, the bill aims to shield investors and the financial system from risks related to the fast adoption of stablecoins, that saw its market surging up to twenty trillion yen, or more than $150 billion.
The new legal framework can reportedly go in 2023, with Japan’s money Services Agency about to introduce laws for stablecoin issuers in the coming months.
( Helen Partz, Cointelegraph, 2022 )