Japanese Consortium to Research Direct Trading of Electricity with Blockchain

A Japanese consortium is to research the use of blockchain technology to determine the price of surplus electricity generated by photovoltaic power generation, and a new system capable of direct trading.Japan Unisys to Build Blockchain Platform to Facilitate Trading of ElectricityA partnership between the University of Tokyo, IT company Japan Unisys, electric utility Kansai Electric Power, and Mitsubishi UFJ Bank, the largest in Japan, will study the viability of a dedicated platform powered by blockchain that manages direct trading of electricity.The research addresses the widespread use of renewable energy such as solar power generation, which is leading to a change of the current power supply system from a conventional large-scale intensive type to a self-sustained distributed type.Researchers estimate that in the future electricity will be directly traded through a dedicated platform.As distributed ledger technology spreads in the financial sector and other industries, including energy management, the Japanese consortium will test a blockchain powered platform to test how well it determines the purchase price between electric consumers and consumers. For instance, a production consumer who uses the electricity generated by himself and sells the surplus.The study will use the surplus electricity generated with solar power equipment at consumers’ houses to determine prices, conduct simulated transactions with blockchain technology, and send power to multiple consumers, according to the announcement.“Through this empirical research, we will acquire knowledge on power direct transactions using blockchain technology, and will continue to provide more practical empirical research, such as verification at home and collaboration with financial institutions. We will contribute to the realization of a society to utilize in a sustainable manner.”The distributed system will be developed by Japan Unisys with Mitsubishi UFJ Bank (MUFG) advising on the use of blockchain on settlement and transactions.The utility company will create the demonstration system at the same experiment center, and the University of Tokyo is in charge of the research and findings.MUFG is highly involved with the technology. In May, the bank announced it will commence the commercialization of blockchain payments by early 2020. Its blockchain, developed by U.S. firm Akamai, will focus on a high throughput of up to one million transactions per second.The use of blockchain for electricity trading is not new.Matchmaking platform Bittwatt has recently launched its decentralized service of energy supply, billing, and balancing. The platform integrates regulatory information and data shared between energy suppliers, grid operators and smart consumers.Featured image from Shutterstock.

Japanese Government to Simplify Cryptocurrency Taxation Process

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A committee of tax experts in Japan that is responsible for advising the government on taxation matters has called for the simplification of the country’s cryptocurrency tax filing process.

According to officials of the tax panel, the process is currently complicated and a change is required in order to enhance accuracy and compliance. Per a Japanese news publication, Sankei, the committee held a meeting earlier in the week where the proposal to change the current cryptocurrency tax filing system was discussed.

Part of the problem according to the committee lies in the fact that calculating cryptocurrency gains for taxation purposes is a complex affair and this discourages some owners of digital assets from declaring their crypto holdings when filing tax returns.

Taxing Gains and Conversion Premium

According to the tax panel, cryptocurrencies in the Asian country are taxed not only on the gains made but also on the gains accruing when one digital asset is converted into another. Other complications stem from the fact that a unified source of historical data on prices is lacking. Towards finding a solution the panel has indicated that it will hold meetings where it will seek views and opinions from various stakeholders.

As previously reported by CCN cryptocurrency investors in Japan face crypto tax rates ranging between 15% and 55% and this is classified under miscellaneous income. The amount paid as tax depends on earnings with the higher rate imposed on the high-earners. For instance, investors who generate yearly earnings of more than 40 million yen (approximately US$365,000) pay a 55% rate on their cryptocurrency income.

The view by the tax panel that simplifying the cryptocurrency tax filing process will enhance compliance is correct as it has been previously noted that a significant number of crypto investors in Japan could be evading taxes. A report released earlier this year, for instance, indicated that out of the 549 individuals who recorded a non-working or non-operational profit (income generated from investments) of US$1 million in 2017, about 331 were investors in the crypto space.

https://twitter.com/GigaBitcoin/status/1001322461437177861

Tax Avoidance

This was however met with incredulity with some observers saying that many more evaded paying taxes on their crypto investments especially given the fact that Japan is not only the world’s third-largest economy but the level of cryptocurrency use, awareness and adoption is among the highest in the globe.

“If the rapid growth of the cryptocurrency sector in late 2017 is considered, 331 is a number that is simply too low to be true. A large portion of cryptocurrency investors probably did not declare their earnings to the government,” one analyst observed as CCN reported at the time.

Featured image from Shutterstock.

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Omise Bags Japanese Investment to Support its Blockchain PayPal Alternative

Japanese venture capital firm Global Brains has invested an undisclosed sum into Omise Holdings, a Thailand-based FinTech service provider, the companies announced in a press release.Global ExpansionThe investment, which is also led by 31VENTURES, a venture capitalist arm of Mitsui Fudosan, one of the largest real-estate developers in the country, and returning Indonesian venture capital SMDV, is aimed at financing Omise’s expansion plans in Japan. It would also offer support to the development of Omise’s financial infrastructure, which includes a PayPal-like payment and remittance service, and an Ethereum-powered decentralized exchange.Improving the traditional financial infrastructure with innovative tools will be Omise’s prime agenda as it expands into new territories. The startup recognized the millennial’s need for a border-less and speedy payment service as their businesses grow globally.“Global expansion is a key growth driver for businesses around the world, yet financial transactions are being processed by legacy platforms built on infrastructures that are not geared to support global commerce needs,” the Omise statement read. “As global commerce and population movement grow, the ability to conduct payments anytime and anywhere becomes a necessity.”Omise will, therefore, eye enterprise adoption in Southeast Asia as a part of its strategy, beginning with Japan. The company will leverage on it OMG Network, eWallet Suite, and OMG DEX financial tools to enable local businesses and individuals to conduct day-to-day finance operations from the comfort of their mobile phones.In a statement to Tech in Asia, the company’s spokesperson acknowledged Japan’s enthusiasm towards blockchain-enabled startup like theirs. “We have [many] services under Omise Holdings which our investors’ portfolio companies could choose to implement according to the requirements of their business needs,” the spokesperson said.