According to a 2023 research paper (title: “A study on Non-Performing Assets Cases and Cryptocurrency in Japan”) by Burina Fujiwara — who is at the Department of Economics and Finance, College of Business, City University of Hong Kong — Japan has established a robust regulatory framework for cryptocurrencies. Governed by the Payment Services Act (PSA) and the Financial Instruments and Exchange Act (FIEA), the country has set a precedent for other nations to follow. Fujiwara notes that this regulatory environment has made Japan a significant player in the global cryptocurrency market.
Fujiwara’s research highlights that while Bitcoin often garners the most attention, XRP holds a unique position in Japan’s cryptocurrency market. She points out that XRP serves as an intermediary mechanism for exchanging different currencies or networks, setting it apart from other cryptocurrencies.
According to Fujiwara, XRP had an impressive trading volume in Japan in February 2022, with nearly 1.36 billion units traded, making it the cryptocurrency with the highest spot trading volume. This significantly outpaced Bitcoin, which had a trading volume of about 180 thousand units in the same month. Fujiwara attributes this unique standing of XRP in part to its strong partnership with Japanese financial giant SBI Holdings. She notes that SBI Holdings invested close to 300 million in Ripple in 2017, providing a substantial boost to XRP’s market presence in Japan.
Fujiwara observes that the partnership between SBI Holdings and Ripple has instilled a high level of confidence among Japanese investors. She believes that this has led to significant trading activity in XRP and has been a major factor in its price movements in the country.
Fujiwara refers to surveys that indicate a close competition between Bitcoin and XRP among Japanese traders. She cites a Twitter survey by a Japanese cryptocurrency exchange, BITMAX, revealing that 25% of the 1,498 respondents favored XRP, compared to 26% who favored Bitcoin:
“According to the results of a survey published on Twitter by Japanese cryptocurrency exchange BITMAX on June 12, Bitcoin’s popularity among Japanese traders is comparable to that of the XRP token’s. 25% of the 1,498 respondents said XRP was their favourite cryptocurrency, compared to 26% who said BTC was their favourite. And 9%, Ethereum ETH ranked third.“
However, she cautions that these findings are not conclusive due to the small sample size. Fujiwara’s research also echoes a report from the Japan Virtual Currency Exchange Association (JVCEA), showing that XRP ranks second in yen-denominated digital asset holdings in Japan, just behind Bitcoin.
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