The Japanese government is trying to develop an international payment network for digital currencies very similar to SWIFT to combat money laundering. Reuters reported the news on Thursday.
As per the anonymous source familiar with the report, said the platform would be overseen by FATF team, inter-governmental body and the government of the island nation is planning to launch the network within next few years. Plan for the new system is approved by FATF in June this year. It was proposed by FSA and the Finance Ministry of Japan.
Japan is trying to confirm the safety of digital currencies to push the economic growth and development of the fintech industry. Japan became the leading nation of the world in 2017 to regulate digital currencies at the national level. They are the first country of the globe to welcome Bitcoin as a lawful tender. When it is about cryptocurrencies Japan has always shown a progressive mentality.
SWIFT is utilized by financial organizations everywhere in the globe to send sensitive financial information and transactions. On the contrary, cryptocurrencies can be directed to anyone around the globe by merely knowing the receiver’s wallet address. It remains indistinct how digital currencies will work in the network like SWIFT. How the decentralized blockchain network gets implemented into the highly monitored system remains a matter of interest.
It remains a matter of speculation how users will react to this kind of monitored network after experiencing the decentralized system of cryptocurrencies. Although this lack of regulation is the main reason or worries for the banks and the central government.
After the massive hacking attack at cryptocurrency exchange Coincheck, the Japanese government has tightened the security guidelines for the trading platform and has issued a notice to many exchanges for the security breakdown.
The companies willing to offer trading services for the residents of the nation have to acquire a license from FSA. More than 100 companies have applied for a permit to start a trading platform in Japan. So far, the agency has approved a license for three exchanges.
In the G7 meeting of Finance Ministers in France this week digital currencies are most likely to remain a topic.