In a recent press release, the Japanese Ministry of Economy, Trade and Industry (METI) has shed light on investment opportunities in security tokens and blockchain-based assets for Limited Partnership Funds (LPS). The new clarifications will enable LPS to expand their investment options and potentially boost the growth of digital assets in Japan.
Security Tokens under the Financial Instruments and Exchange Act
The FSA has clarified that security tokens, which are transferable using blockchain technology, will be considered as valuable securities under the Financial Instruments and Exchange Act. This means that LPS can now invest in these security tokens. However, this would be subject to change if there are any modifications in the interpretation or enforcement of the Financial Instruments and Exchange Act.
Interpretation for Assets not Considered Valuable Securities
For assets that are not classified as valuable securities under the Financial Instruments and Exchange Act, LPS can still utilize blockchain technology for asset transfers and related administrative tasks without violating the LPS regulations. However, this is contingent on LPS acquiring and holding these assets.
Caveats
It is important to note that under the current LPS regulations, investments in cryptocurrency assets remain prohibited. METI emphasizes that investors should be aware of this limitation while exploring new investment opportunities in security tokens and blockchain-based assets.
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