Japan to ‘accelerate efforts on Web3,’ head of NFT policy taskforce Masaaki Taira tells Metaverse Japan Summit 2022

Legislator Masaaki Taira (on the screen) talks alongside Shinko Osada (left), director and secretary-general of Future Design Shibuya; and Kunimi Mabuchi, partner executive officer at PwC Consulting LLC.

Legislator Masaaki Taira, who chairs the Japanese government’s taskforce on Web3 policy, discussed the country’s current situation and strategy on Web3 during the Metaverse Japan Summit 2022. 

Taira, a member of the House of Representatives, is the chairperson of the NFT Policy Study Project Team set up by the ruling Liberal Democratic Party.

He shared his views with other speakers including Shinko Osada, director and secretary- general of Future Design Shibuya; and Kunimi Mabuchi, partner executive officer at PwC Consulting LLC, during the talk “The new Japanese digital economy pioneered by Web3 metaverse.” 

The summit was held at the Shibuya Stream Hall in Shibuya, Tokyo, on July 14. It was organised by Metaverse Japan, which aims to become a hub for unleashing Japan’s power in the Web3 era. Around 140 companies, including major Japanese corporations and venture companies, have expressed an interest in joining the group as members since its establishment on March 14, 2022.

■ Web3 is a solution to undervalued content

Taira, who led the compilation of the NFT (Web3) White Paper at the Liberal Democratic Party, told audiences that “the value of content is too low from a global perspective. Web3 is one way of solving this problem.”

With the advent of NFTs and DAOs following the crypto currency boom, Web3 is being completed as an ecosystem globally.

Taira said Web2 had led to problems such as social division, uneven wealth distribution and centralised information through SNS, and the blockchain technology, as represented by Web3, could be a means of solving them.

“Web3 contributes to the growth strategy of the ‘new capitalism’ advocated by Prime Minister Fumio Kishida and is also in line with the distribution policy. For this reason, it has been incorporated into the Digital Agency’s priority plan, the intellectual property plan and the LDP’s pledge, and has become a clear national strategy,” Taira said.

“I think DAOs will be the first major invention since joint-stock companies, and more and more young people will live in the parallel world of the metaverse. An economic sphere separate from the real one will be created.”

He noted that some aspects about the blockchain infrastructure, such as how robust it is and how much data it can handle, had to be examined, but “we want to reflect on the fact that Japan missed the Web1 and 2 and make sure that we don’t miss the Web3 wave. This movement will not stop”.

■ Different legal systems, different paces

There are suggestions that “Japan is lagging behind” to many in the rest of the world on Web3.

Taira attributed this to the differences between the legal systems of Japan and other countries.

“Laws in the UK, US and Singapore are based on precedents, so their rules are set by the accumulation of cases. Businesses also start new services rapidly. They can launch a service after asking a lawyer for an opinion.”

“On the other hand, Japan and Germany have clear rules under continental laws. Grey areas cannot be eliminated unless the related rules (laws) are eliminated. This is why it took two to three years just to amend the laws, and we have been losing in the internet world in the past. We need to keep moving forward, push politicians and be more sensitive. Otherwise, we won’t be able to keep up with the rest of the world.”

Taira touched on the case of Sota Watanabe, who founded a start-up,  Astar Network, in Singapore: “The taxation of governance tokens at market value is an issue. Their tax rate is the highest among crypto assets. I want to do something about it. If we can’t solve the issue of governance tokens by the end of this year, we may have to accept that it might be better to do it in Singapore.” Expressing a sense of urgency, Taira said this would require the Prime Minister’s commitment to complete the process in one year, as opposed to normally two to three years. 

■Web3 matters not only to Japan but also to Western countries

When asked by Mabuchi about his expectations for the Metaverse Japan Summit, Taira said: “When doing something new, it is best to consult lawmakers, but individual Diet members are very busy and may not be able to respond to individual appointments with business operators.” He said it would be effective for companies to give suggestions to groups such as the Metaverse Japan Summit, which then put them into a summary and relay it to legislators.

He added: “In the data-driven economy (of Web2), countries like China, which can aggregate information in a despotic manner, have shown their strength. But it has been difficult for countries that value democracy and personal information (such as Japan) to do the same. On the other hand, such countries cannot get on the Web3 (where individuals hold data). Japan is currently the chairing country of the G7, so we believe that this is an important global strategy not only for Japan but also for the West.”

“There is no doubt about the potential of Web3. There are large companies that ask questions like ‘which start-ups are making money now, in what industries and how much money are they making,’ but this kind of talk is already over. In the Internet world, even if the company is in the red, its share price could keep rising. I don’t know when the real killer content will emerge, but there are many possibilities.” 

“The overall value of the Web3 market may be dropping due to monetary tightening, but the small money-makers will then disappear. The essential people will remain and expand the space in the future, so there is no way not to follow them.” 

Taira concluded by saying that “there are many fans of Japan among overseas crypto people” and that “it is important to have various overseas Web3 talent coming to Japan. A global network is being established and we have received many requests to come to Japan. We hope to hold an international conference within the year. In just six months, Web3 has become a national strategy. We would like to accelerate the pace of our efforts.”

(This article was originally written in Japanese by Rumi Tomiya. The English translation was compiled and edited by Kit Lai.)