Regulators in Japan have proposed considering and treating virtual currencies, such as bitcoin, as methods of payment and settlement similar to conventional fiat currencies.
Japan’s Financial Services Agency (FSA) is considering legislative revisions that would recognize bitcoins and other digital currencies as equivalents to conventional currencies, citing that the revisions see bitcoin as “fulfilling the functions of currency,” The Nikkei Asian Review reports.
Japanese financial regulators have proposed handling virtual currencies as methods of payment equivalent to conventional currencies, a step that would strengthen consumer protection and spur growth in the virtual economy.
The Financial Services Agency’s legislative revisions would recognize bitcoins and other virtual currencies as fulfilling the functions of currency, it was learned Tuesday.
Under the FSA’s proposed definition, virtual currencies must serve as a medium of exchange, that can be used to purchase goods and services and also must be exchangeable for legal tender through purchases or trades with an unspecified partner, according to the report.
Currently in Japan, bitcoin and virtual currencies are recognized as “objects but are not treated on par” with established traditional currencies.
The changes are said to be submitted during the current ordinary Diet session, the national legislature of Japan, with the goal of passage before the term ends, according to The Nikkei.