A Japanese opposition party politician who is leading calls to regulate Bitcoin said he isn’t satisfied with the government’s response to his questions on the matter and plans to seek more answers.
Democratic Party of Japan lawmaker Tsutomu Okubo will submit further questions on March 10 at the earliest, he said in an interview in Tokyo yesterday after the government issued a statement saying Bitcoin isn’t a currency.
Japan became a focal point for the global dearth of Bitcoin regulation last week when Mt. Gox, a Tokyo-based exchange for the virtual currency, went bankrupt after coins valued at more than $500 million disappeared. Japan has no law to define Bitcoin and ministries are gathering information on it, the cabinet said in a statement in response to the first round of questions from Okubo.
The government’s answers “were disappointing,” said Okubo, a former vice finance minister who used to work at Morgan Stanley. “They should squarely address the issue given that Mt. Gox, a company based in our country, is inflicting huge losses on its customers. The government should provide legislation regarding Bitcoin swiftly.”
Okubo plans to ask Shinzo Abe’s administration about the responsibilities of Japanese banks used by Bitcoin exchanges to settle transactions with customers, and what measures lenders should take to prevent money laundering, he said. The questions will be answered on March 18 if he submits them on March 10, according to Okubo.
Mt. Gox had accounts at Mizuho Financial Group Inc.’s banking unit to settle transactions, Riichirou Tanaka, a spokesman for Japan’s third-largest lender by market value, said by phone this week.
In the statement, the cabinet said the nation’s banking law doesn’t allow lenders to broker Bitcoin trades or set up accounts for customers to store the digital assets. Current rules don’t prevent brokerages and asset managers from managing clients’ Bitcoins, according to the statement. Bitcoin transactions can be taxed, it said.
Mt. Gox filed for bankruptcy protection on Feb. 28, saying 850,000 Bitcoins were missing and may have been stolen by hackers. Fewer than 1 percent of its creditors are from Japan, the exchange’s lawyers said.
“Mt. Gox can’t be rehabilitated if there is no legal basis for Bitcoin,” said Okubo.