As the legal situation around crypto assets remains controversial, Japan is trying to figure out the best ways to regulate crypto.
A set of guidelines was developed by Tama University in association with a government-funded research group. The document states the need to legally standardize Know Your Customer and Anti-Money Laundering (KYC and AML) requirements. It also suggests adopting a set of rules aimed at increasing shareholder’s safety and states the need to prevent insider trading.
What’s more, the researchers have revealed two features that are indicative of a trustworthy ICO. Firstly, the investors of such an ICO know exactly how the raised funds will be distributed and used. Secondly, the developer team should constantly track the progress of the project and compare it with the plan outlined in the whitepaper, notifying the users of any possible delays. Unfortunately, many current projects fail to set concrete dates and targets, so the progress can hardly be measured.
Whether or not ICOs are safe to invest in remains a subject for a debate. Japan, however, is trying to provide clear and acceptable rules for all interested sides, while steering clear of too much regulation.