To promote Japan’s Web3, the Liberal Democratic Party approves the proposal of the “New Capitalism Implementation Headquarters” as a growth strategy

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Recommendations for crypto-asset-related companies

Liberal Democratic Party lawmaker Taira Masaaki, chairman of the “web3 project team (PT)”, said on the 30th that the proposal formulated by the “New Capitalism Implementation Headquarters” was approved by the Liberal Democratic Party Policy Research Council and became the Liberal Democratic Party’s growth strategy. reported that

Rep. Taira also serves as the secretary-general of this executive headquarters. His proposal also mentions crypto assets (virtual currency), and describes what should be considered and worked on in promoting Web3. For Web3 this time, proposals regarding corporations are written.

Regarding this proposal, it is said that the government will be asked to reflect it integrally in the “New Capitalism Action Plan” and “Basic Policy for Economic and Fiscal Management and Reform (Basic Policy)” that will be compiled in the future, and to put it into practice.

“Snakes that don’t shed their skin die” (LDP New Capitalism Implementation Headquarters Proposal)

The proposal drafted by the Liberal Democratic Party’s New Capitalism Implementation Headquarters (Chairman Fumio Kishida, Acting Chief Toshimitsu Motegi, Acting Chief Koichi Hagiuda, and Secretary General Masaaki Taira) was approved by the Liberal Democratic Party’s Policy Research Council and became the growth strategy for the Liberal Democratic Party. I was.

Details → https://t.co/wf8RgGPi6P

— Masaaki Taira (@TAIRAMASAAKI) May 30, 2023

The proposal regarding Web3 is listed as one item in “DX (Digital Transformation) Promotion”. It is roughly divided into three, but the first one is the tax treatment of crypto assets. Regarding this point, the draft proposal states as follows.

Regarding the tax treatment of crypto-assets, first of all, whether it is possible to distinguish the case where a third party continuously holds crypto-assets for purposes other than short-term trading from the holding of other crypto-assets is legally and legally possible. It should be considered as soon as possible, including how it should be in terms of accounting.

Although there is no detailed explanation this time, this is a proposal regarding crypto assets held by corporations. The web3PT white paper provides more details on this subject. web3PT requests that tokens issued by other companies and held by third parties that are not for short-term trading purposes be excluded from the end-of-term market valuation, but this content was not included in the 5th year of Reiwa tax reform outline.

connection: The web3 and AI fields are LDP policies, and the LDP Policy Council approves the white paper

The reason for making such a proposal is to promote the start-up of blockchain-related businesses in Japan. Web3PT points out that Japan needs to create an environment that makes it easier to invest in tokens.

In relation to this point, we also made the following recommendations.

We should encourage discussion at the Accounting Standards Board of Japan on the accounting treatment of crypto-assets. At the same time, the Japanese Institute of Certified Public Accountants should promote the formulation of guidelines.

connection: “NFT as a national growth strategy” Interview with Liberal Democratic Party Digital Society Promotion Headquarters Masaaki Taira

Financing with crypto assets

The third recommendation is about fundraising through crypto assets and tokens. Currently, there is a movement within the government to diversify investment methods for blockchain-related businesses, but web3PT points out the following issues in a white paper.

Regarding the use of an investment business limited partnership (LPS) as an investment vehicle for crypto assets and other tokens (governance tokens, etc.), and the necessity of registration as a crypto asset exchange business when using crypto assets at that time , it is necessary to organize the points further in the future.

Under current rules, LPS cannot invest in startups that issue cryptocurrencies or other tokens. In this regard, I made the following recommendations.

The actual state of fundraising through crypto assets and tokens should be investigated and sorted out, and those that contribute to the smooth supply of funds by business operators should be considered as investment targets under the LPS Act.

connection: Fukuoka City proposes deregulation of virtual currency companies = Cabinet Office

What is an investment business limited partnership?

A type of “investment partnership” formed by financial institutions, etc., mainly venture capital, for the purpose of investing in securities issued by privately held venture companies.

It consists of a general partner (GP), who has unlimited liability for the operation of the partnership, and a limited partner (LP), who is a capital investor and whose liability is limited only to the amount invested. (Reference: Nomura Securities)

Cryptocurrency Glossary