Press Conference by Taro Aso, Deputy Prime Minister, Minister of Finance, and Minister of State for Financial Services

(Excerpt)

(Friday, March 7, 2014, 8:51 am to 9:03 am)

[Questions and answers]

Q.

With regard to Bitcoin, I believe the Cabinet today approved a written reply to the Memorandum on Questions submitted by a DPJ member of the House of Councilors. There have been calls even within the ruling party for regulation of Bitcoin, so please let us hear your opinion on the future prospects for regulation.

A.

A written reply to the Memorandum on Questions has been approved by the Cabinet, and this will be made publicly available after the Chief Cabinet Secretary has held his press conference; until then, I can only answer questions within a limited scope. Despite this written reply, though, the relevant ministries and agencies are still in the process of gathering information on Bitcoin. We do not yet have a full grasp on the nature and status of Bitcoin, so at the present stage we are trying to acquire these.

Q.

In earlier reporting on Bitcoin, there was mention of adopting a basic approach of prohibiting banks and securities companies from handling, buying, or selling Bitcoin or mediating exchanges; do you believe this is a feasible approach?

A.

Because Bitcoin is not currency, there is first of all the question of whether the Financial Services Agency or the Ministry of Finance has jurisdiction. Alternatively, does the Consumer Affairs Agency because some consumers have been deceived? Or the Ministry of Economy, Trade and Industry because goods are being transferred? Opinions are somewhat divided, so at the moment we cannot say any more in response to your question until we have a little better understanding of the circumstances with the help of people concerned. Some people have suggested that Bitcoin dealing might qualify as gambling, meaning the responsibility for enforcing the law would lie with the police and, this might be the case. We have asked why the head office of MtGox is located in Shibuya, but no one knows. Was it nearby just by chance? This is not likely. In this particular case, about 1000 of the aggrieved parties are Japanese and tens of thousands are foreigners. We still are not certain whether the Japanese victims number 1000 or not. More information may come in later, so we would like to have a little more time to develop a fuller picture before we reply.

Q.

This problem is still being worked out here in Japan, and it seems likely that regulation will need to be coordinated with other countries in future. In what venue should that take place?

A.

We do not yet have access to all the facts of the matter, so we still do not know whether the people deceived were at fault or whether Bitcoin will be subjected to future regulation. As for coordinating with other countries, I think it is clear that Bitcoin is not a currency because it does not have mandatory circulating power, but we are not yet quite sure of its status. Several billion yen was said to have been taken by hackers, but there is no record anywhere of this amount, making one wonder if it is true. If people have been deceived, it is a simple case of fraud. And, with Mt Gox having filed for bankruptcy protection from its creditors under the Civil Rehabilitation Law, I cannot comment on a specific case. New information is steadily coming in at the moment, but we still have not assembled a full picture.

(End)