Uniform global curbs on cryptocurrency trading may be
hard: BOJ official
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[January 25, 2018]
By Leika Kihara and Yoshifumi Takemoto
TOKYO (Reuters) - Policymakers around the
world may debate ways to deal with the volatility of bitcoin and other
cryptocurrencies but imposing global, across-the-board regulations on
their trading won't be easy, a senior Bank of Japan official said on
Thursday.
South Korea and China have tightened regulations but Japan wants to
ensure any rules that it adopts won't hinder innovation, said Hiromi
Yamaoka, head of the Japanese central bank's division on payment and
settlement systems.
"There's undoubtedly growing interest among global policymakers on how
to deal with cryptocurrencies," Yamaoka, whose division also oversees
cryptocurrencies, told Reuters.
"Japan's approach would be to think about how to curb excesses without
discouraging innovation," he said.
Bitcoin <BTC=BTSP> soared more than 1,700 percent last year to a record
high as investors snapped up the virtual currency on expectations of
further steep gains.

Alarmed by the global boom, national authorities across the globe,
particularly in Asia, have attempted to put the brakes on trading of
cryptocurrencies. Fears of a wider clampdown pushed bitcoin down nearly
20 percent last week.
Yamaoka said while there were some "speculative moves" in the
cryptocurrency market, it was hard to say whether bitcoin was
experiencing a bubble because cryptocurrencies have no underlying assets
to measure their real value.
It will also be hard to define which cryptocurrency needs to be
regulated and for countries to agree on a uniform set of rules, given it
isn't easy to come up with common regulations even for traditional
banking services, he said.
"It's uncertain whether global cooperation would mean global
regulation...It may mean sharing a common view on the risks involved in
cryptocurrency trading and seeking to send out a common message," he
said. "Global harmonization may not necessarily mean global regulation."
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Hiromi Yamaoka of the Bank of Japan's (BOJ) speaks at an interview
with Reuters at his office in Tokyo, Japan, October 4, 2016.
REUTERS/Kim Kyung-Hoon

NO MAJOR PROBLEMS SO FAR
France has urged for debate on bitcoin at a meeting of G20 major economies in
Argentina in March. Germany has also said any attempt to regulate
cryptocurrencies must be on a global scale.
Yamaoka said while cryptocurrency prices have been volatile, they have yet to
disrupt Japan's banking system as cryptocurrencies are hardly used for payments
and settlements.
As long as they are not used much for payments and settlements, they won't
affect monetary policy much, he said.
But policymakers need to check how much exposure banks have, how much funds are
investing in them globally, and how much leverage investors are taking, Yamaoka
added.
"So far, I don't think there are any big problems. But we need to look
carefully," he said.
"If the exposures turn out to be huge, we may need to follow up and work to
maintain financial stability together with the Financial Services Agency."
Japan's global share of the bitcoin market jumped after a clampdown last year by
Beijing. The government in April granted cryptocurrencies legal status as a
means of settlement and recognized several digital currency exchanges.
(Additional reporting by Yoshifumi Takemoto; Editing by Jacqueline Wong)
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