Japan’s finance and cryptocurrency regulator, the Financial Services Agency (FSA), released a report on DeFi, blockchain, and cryptocurrencies. Its authors concluded that it might be necessary for the authorities to develop precise rules on the decentralized financial sphere.
Financial Services Agency wants DeFi regulation
The document is the second report from the FinTech Innovation Hub, a task force set up by the FSA in 2018. Its main objective is “to identify new avenues and business trends in the fintech and blockchain space.” While the team is not supposed to draft legislation, the report is likely to affect the activities of FSA executives, who are responsible for regulation.
The report is a summary of events and meetings that have taken place in Japan or online over the past few months. The group also wrote in the document that it was “under discussion” in the DeFi space. She said regulators should better understand trends in the blockchain community, which could enable the development of DeFi technology or improve various governance mechanisms in the market.
The authors of the report also added that special DeFi regulations are likely to be created in the future. Discussions on this issue are reportedly already underway within the FSA. It was added that such conversations take place not only in meetings on Strict DeFi, but also in these cryptocurrencies.