Japan: Financial Services Authority Approves Crypto Garage for Fintech Sandbox, the First Blockchain and Finance Project Authorized

Crypto Garage has accepted into the Japanese Financial Services Authority (FSA) Fintech Sandbox program. This is the first blockchain and finance project authorized by the Sandbox.

The FSA announced the news in a release which was followed by a post by the parent company of Crypto Garage. Japan has become a more welcoming jurisdiction when it comes to blockchain based financial services.

Crypto Garage is building a trading environment for digital assets that can “realize the immediate sale and purchase” of these assets. Crypto Garage explains they are implementing a trading system via their “Settlenet” that leverages a Yen based Stablecoin as well as a the Bitcoin-based “Liquid Bitcoin”. The goal is to enable “rapid, secure and confidential transfer of the crypto assets while eradicating counterparty risk through a delivery-versus-payment method.”

The company says the current crypto market faces “challenges which prevent the sound development of the crypto market.” They believe that by enabling delivery versus payment settlement of the crypto assets, the industry can overcome these challenges, and accelerate the growth of the overall crypto market.

Crypt Garage outlines the following hurdles:

  • An underdeveloped market for the exchanges and institutions leads to unstable liquidity and/or price fluctuation
  • Lack of uniform trading and settlement platform leads to i) high counterparty risk, ii) low confidentiality of trade between the trading parties and iii) low visibility of trading for the regulatory authorities
  • Reliance on consumer-facing crypto exchanges which leads to an increased security risk from leaving crypto assets on exchanges

The one-year trial program begins on January 31st.

Crypto Garage is a subsidiary of Digital Garage, Inc., a publicly traded company that is listed on the Tokyo Stock Exchange. Digital Garage is a “web solution provider and a business incubator.”

 

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