Six major Japanese Brokerage Firms Establish Japan Security Token Offering Association


Yuko Seimei, president of Tokyo’s securities giant Monex Inc. has announced that,  together with five other securities companies, the Japan Security Token Offering Association (JSTOA) has been formed. Seemingly a competitor to Japan Security Token Association (JSTA). 

The five other companies include SBI Securities Co. Ltd., Securities Co. Ltd., Daiwa Securities Co. Ltd., Nomura Securities Co. Ltd., and Rakuten Securities, Inc., and the JSTOA will be chaired by Yoshitaka Kitao effective, October 1, 2019.

The JSTOA will focus on self-regulation regarding security token offerings (STOs), with the aim of the healthy development of an STO fund-raising model. Similar to the role Japan Securities Dealers Association (JSDA) self governs the Japanese securities industry, FINRA plays in the USA for securities or FINMA in Switzerland, but the JSTOA will focus on tokenomics. 

From the press release:

“Unlike initial coin offerings (ICOs), which have experienced some fraudulent cases, issuance and trading of security tokens are legally recognized and prescribed. STOs have been gaining popularity in the U.S. and other countries as a new methodology of financing. Japan is also following the trend and is ensuring that sufficient conditions are in place for STOs to become widely used. For example, in May 2019, “Amendments to the Payment Services Act, etc. in response to the diversification of financial transactions associated with the development of information communication technology” was enacted in which “Rights to Transfer Electronically-Recorded Claims” is prescribed.”

The JSTOA plans to consolidate expertise from Japanese securities companies and other entities so that the STO business opportunities can be further explored and developed in Japan. The association is planning to obtain certification as an Authorized Financial Instruments Firms Association based on the Financial Instruments and Exchange Act and to fully leverage its capabilities as a self-regulatory organization.