6 Key Insights from Quantstamp’s Kei Oda
In this article, we had the opportunity to speak with Kei Oda, the head of Japan and the Asia-Pacific region for Quantstamp, a leading Web3 security firm specializing in auditing smart contracts and developing blockchain security solutions. Kei, who previously worked as a bond trader for 16 years, stumbled upon cryptocurrencies out of boredom and has become deeply involved in the industry. In our conversation, Kei shares valuable insights into his journey into crypto, the current Japanese crypto ecosystem, the challenges faced by the Japanese crypto scene, the potential for more companies to set up in Japan, the impact of collapses like FTX on the Japanese market, and more. Let’s dive in!
1. How did you get involved in crypto?
As a former bond trader, Kei Oda initially didn’t understand or believe in Bitcoin, but he became intrigued by the ability to trade assets around the clock. Kei started trading Bitcoin as a way to pass the time and began researching its value proposition. This led him into the world of crypto, where he discovered the potential for game-changing innovations like Ethereum. Kei’s background in trading and his short attention span made him appreciate the fast-paced nature of the crypto market.
2. What do you think of the current Japanese crypto ecosystem?
According to Kei, Japan has made significant progress in developing a vibrant crypto ecosystem. Despite past incidents such as the Mt.Gox and CoinCheck hacks, Japan has embraced Bitcoin as a payment method and has shown interest in security tokens. Kei believes that the Japanese crypto blockchain ecosystem has excelled and is attracting big companies. The Japanese market offers a unique opportunity for startups due to its size and progressive mindset.
3. What has held the Japanese crypto scene back?
Kei identifies taxation as a key factor that has hindered the Japanese crypto scene. The old regulations imposed heavy taxes on Japanese startups issuing tokens, discouraging innovation. Profit from crypto trading is also taxed as extraordinary income in Japan, with rates as high as 55%. In comparison, other Asian hubs like Singapore and Hong Kong offer more favorable tax rates for startups. These taxation policies have created financial challenges for entrepreneurs and startup founders in Japan.
4. Do you think more companies will start setting up in Japan instead of other Asian hubs?
Kei believes that the Japanese government’s proactive approach to Web3 technologies and its efforts to attract global talent will encourage more companies to set up in Japan. The government is planning digital nomad visas, offering incentives for individuals to work and earn in Japan. With a large market size and progressive regulations, Japan presents an appealing opportunity for companies in the crypto space.
5. What are the challenges faced by Japanese meet-ups and how are you addressing them?
Kei acknowledges that Japanese meet-ups can be overwhelming, with long presentations and limited networking opportunities. To address this, Kei co-created an event called Tokyo Blockchain Night, where like-minded individuals gather to discuss crypto without any sales pitches or presentations. The event aims to foster meaningful connections and create a supportive community.
6. How did the contagion from collapses like FTX impact the Japanese market?
Kei explains that FTX’s Japanese subsidiary, Liquid, remained fully liquid and solvent due to stricter asset custody regulations in Japan. Japanese customers of FTX were assured of their funds’ safety, while customers of FTX International faced uncertain outcomes. The Japanese regulations enacted after the CoinCheck hack were stricter compared to other jurisdictions, which has resulted in increased Japanese activity in the crypto market. Large Japanese financial institutions like MUFG are even planning to launch stablecoins.
In conclusion, Kei Oda provided valuable insights into the Japanese crypto ecosystem, its challenges, and its potential for growth. Japan has made significant strides in embracing cryptocurrencies and blockchain technology, attracting both startups and established companies. However, taxation policies and strict regulations remain obstacles that need to be addressed for further development. With the Japanese government’s efforts to foster innovation and attract talent, we can expect to see more companies setting up in Japan in the future.
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