Japan’s rise as a global center for cryptocurrencies began with the unlikely story of an American felon who moved into the country looking for a fresh start.
Roger Ver arrived in Japan in 2006 after serving some time in prison for selling explosives online. He came across bitcoin in its early days. He became an avid supporter who organized parties and gave away coins to encourage people in using them. He also established a friendship with Mark Karpeles, a young Tokyo-based Frenchman who bought Mt. Gox—the world’s largest bitcoin intermediary at that time.
Together, the two of them helped build a community of crypto experts who spread the word on cryptocurrencies, helped popularize them, seeded early startups and convinced government official’s on the industry’s potential. All these helped Japan’s rise as a bitcoin haven, despite the current global crackdown on the cryptocurrency industry. Japan has maintained a supportive regulatory ecosystem, despite issues ranging from investor fraud to the $500 million hack of Coincheck this year.
“If it wasn’t for Mt. Gox, I wouldn’t have been involved with Bitcoin regulation at all,” says former Liberal Democratic Party Lawmaker, Mineyuki Fukuda, who helped create the country’s rules regarding cryptocurrencies.
Following a rise in the popularity of cryptocurrencies, governments around the world, from the U.S. to China, have proposed regulatory policies or outright bans to prevent abuse.
Despite all the issues hounding the industry, Japan’s lawmakers have remained very supportive. They are moving to regulate new and upcoming exchanges, instead of banning them outright. Last week, Japan took the first step towards legalizing initial coin offerings (ICOs). Encouraged by the government’s support, Fintech firms are stepping up their investments.
“Personally I was thinking, Ok, they’re probably going to take the Chinese approach of ‘We’re just going to ban this thing and nobody’s going to be able to do it again,” says former Mt. Gox employee Thomas Glucksmann. “But they kind of went the opposite way,” he added.
Ver did not plan on joining the crypto industry when he came to Japan. He was already a millionaire, thanks to the same online business that landed him in jail in the US. He had a Japanes girlfriend before and decided to move to Japan to find a new one. Karpeles also moved to Japan fueled by his love of anime and the Japanese culture.
Ver started buying coins on Mt. Gox after discovering Bitcoin in early 2011. He organized meetings for bitcoin enthusiasts in different parts of Tokyo. He eventually became known as Bitcoin Jesus as he gave away coins when they were still worth $1 each. A single bitcoin now trades at about $ 7,834.73 as of this writing. According Ver, he handed out roughly 10,000 bitcoins, which would be worth more than $50 million today.
Ver remained bullish even after Mt. Gox’s bankruptcy in 2014. According to him, in the wake of the bankruptcy, Japan implemented laws –regulation of cryptocurrency exchanges, allowing the use of bitcoin in retail payments –that were more industry-friendly than expected. But, if Ver had his own way, he’d prefer to have no rules at all.
“I’m a bit averse to dealing with politicians, regulators and lawmakers,” said Ver. “The regulators aren’t technologists. They don’t know about this,” he added.
Those laws, however, are now credited for the influx of corporate interest in the industry. Electronic retailers such as Yamada Denki Co., for example, have incorporated the use of bitcoin for payments. Major tech firms such as messaging provider Line Corp. are now launching their own crypto exchanges. Major financial establishments and banks are pouring millions worth into blockchain startups.
From an inconspicuous crypto hub, Japan has grown into a crypto haven not only of Asia but to the world.
While Ver refuses to take full credit for Japan’s embrace of crypto, he concurs that he did have a role to play in its early years.