Cryptocurrency

Japanese customers can’t use the new cryptocurrency on Line’s messaging app

Line Corporation, a Japanese messaging app company whose shares trade on the Tokyo Stock Exchange and the NYSE, on Friday announced the launch of its own blockchain network (Link chain) and cryptocurrency (Link). The $11 billion company has the built-in customer base that most digital currency startups can only dream about. By some estimates, it boasts nearly 200 million users—and it didn’t even conduct an ICO.

Unfortunately, licensing requirements will prevent Line’s customers in Japan and the US from actually using its new currency, at least initially. Since 75 million of Line’s monthly active users are located in Japan, this could undermine the benefits of its large customer base.

Japan (Pixabay)

Line plans to exclusively list Link tokens on its cryptocurrency exchange, BitBox, which opened in Singapore (paywall) in July. However, the exchange, which only facilitates crypto-to-crypto trade, still requires approval from Japan’s financial regulator, the Financial Services Agency. Although the agency has approved more than 10 cryptocurrency exchanges, after a devastating hack at one exchange, the FSA tightened its oversight standards and issued “business improvement orders” to several upstart trading platforms.

Luckily for Line, the new FSA commissioner, Toshihide Endo, has signaled a renewed embrace of the cryptocurrency industry. “We have no intention to curb (the crypto industry) excessively,” he told Reuters in August. “We would like to see it grow under appropriate regulation.”

With BitBox’s licensure pending, it’s unclear whether the exchange has the go-ahead in Line’s other key markets—Taiwan, Thailand, and Indonesia. In mid-August, BitBox was not among the seven exchanges that Thailand’s SEC reportedly allowed to continue operating. Line did not immediately return a request for comment.

While Line waits for its BitBox to be approved in Japan, its Link Points will function as a stand-in for the Link tokens. Users can eventually exchange the points for tokens after Line gets official regulatory authorization.

The biggest remaining questions are these: what will Link tokens be used for and how many are there?

Line says Link tokens will be part of a new rewards system for its customers. The tokens could be used for anything from paying for online content and games to commerce and discounted trading fees. Customers will earn Link by using various services on the Line app, and in September, the company plans to debut its first two decentralized applications (dapps).

In total, 1 billion Link will be issued, with 800 million units gradually distributed to customers and 200 million units held in reserve by Line Tech Plus (which is based in Singapore). The tokens are divisible into millionths. At this point, it appears that Link tokens do not have a monetary equivalent.

 

Source: https://qz.com/1375976/japanese-customers-cant-use-the-new-cryptocurrency-on-lines-messaging-app/

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