Major Japanese companies want to prioritize Bitcoin and Ether for crypto ETFs

A group of Japanese financial institutions is urging the government to focus on major tokens like Bitcoin and Ether in talks to allow exchange-traded funds for cryptocurrencies.

According to a Bloomberg report, a group of Japanese companies submitted a set of proposals on October 25 with a title that translates to “proposals for the composition of crypto asset ETFs, etc. in Japan.” The country is undecided whether to allow the vehicle.

The group’s proposal states that the majority of votes agree that Japan would prioritize Bitcoin and Ethereum for ETFs if it decides to allow crypto ETFs. It also calls for a review of Japan’s tax system and, in particular, a separate tax on earned income.

The proposal states that the large market capitalization and “stable track record” of the two cryptocurrencies make them attractive to investors looking to “build assets over the medium and long term.”

The Group, Mitsubishi UFJ Trust and Banking Corp. and Sumitomo Mitsui Trust Bank, crypto exchanges like bitFlyer Inc, and brokerage firms like Nomura Securities and SBI Securities.

In the proposal, the group included a disclaimer stating that the views reflected in the proposals were the consensus of group members rather than individual opinions.

On October 23, Oki Shiozawa, chief investment officer of Sumitomo Mitsui Trust Asset Management, stated that Japanese regulators remain cautious regarding spot crypto ETFs. This is because the Japan Financial Services Agency, the government body that approves financial products, is still quite conservative.

Keisuke Kimura, vice president of the Japan Cryptoasset Cooperation Association, echoes this sentiment. Causing heavy losses for investors, Mt. He said the country faces “regulatory constraints” as well as negative public perception towards crypto due to past incidents such as Gox and DMM.

Still, some Japanese firms remain bullish on crypto. Franklin Templeton and SBI Holdings partnered in July to develop new products, including crypto ETFs. Nomura also launched a Bitcoin adoption fund for institutional investors.

On the other hand, there has been a global shift towards crypto ETFs. The US approved the first spot Bitcoin ETFs in January, followed by Ethereum ETFs in July. Countries in the Asia-Pacific region such as Hong Kong and Australia have also followed suit by approving their own spot crypto ETFs.