crypto startup founder leaves Yap…

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Cryptocurrency tax can be up to 55%.

Crypto companies in Japan are closing, and their founders are moving to other countries, CoinDesk said, citing experts. The reason for the exit of crypto enthusiasts from the country is the high tax rate on cryptocurrencies.

  • Specifically, the tax rate for token issuers is 35%, the portal reports, citing tax accountant Kenji Yanagisawa. In this case, both the issuer and the purchaser of the token are taxed. Depending on the size of the company’s income, the tax rate can be as high as 55%.

  • The founder of blockchain and cryptocurrency consulting firm Gracone, Mai Fujimoto, said she was aware of eight projects that had left Japan. One of them is the Astar Network decentralized application. According to its founder, Sota Watanabe, a serious problem in the Japanese crypto market is unclear regulation and high taxes.

  • Tokens are taxed if they are listed on an active market, but there is no clear definition of an active market, Watanabe told CoinDesk.

  • Some projects place a portion of their tokens on crypto exchanges, and keep the rest to themselves. According to Watanabe, if the market value of the token goes up, the company will have to pay taxes on the entire volume of the token. The lack of tax funds is forcing Japanese crypto startups to sell more tokens on the public market. This has a negative impact on the token price and the general state of the project.

  • On December 10, Japan’s ruling coalition approved a tax plan for fiscal year 2022, in which tokens remain on the list of taxable assets. The current tax regime “will not change for at least a year or so,” said accountant Yanagisawa.

  • In comparison, the state’s share capital gains tax is 20%. If authorities equate taxes on cryptocurrencies with share rates, 10-20 trillion yen ($88-$175 billion) will return to the crypto market in Japan, calculated crypto exchange BITPoint president Genki Oda.

  • Regulators don’t want to develop the country’s crypto market due to the high volatility of the token, Kraken Japan managing director Takeshi Chino told the portal. The authorities believe that the crypto market only attracts speculators and not real investors.

  • According to a 2019 study on the financial literacy of the Japanese population, 11% of the country’s population owns cryptocurrency.

We will remind, at the beginning of the month it became known that the Japanese authorities wanted to limit the emission of stablecoins. According to the regulator, only banks or payment companies must issue fiat-based tokens.

Read also: The first senator – crypto investor in the United States has developed a bill on the regulation of cryptocurrencies.

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