Japanese Government Mulls Promoting NFTs in Sport
The Japanese government is reportedly considering employing non-fungible tokens (NFTs) in the sports industry. The ruling Liberal Democratic Party Web3 “Digital Society Promotion” team is expected to issue a white paper on the matter, which will seek to clarify the regulatory picture for NFT-issuing firms and their potential sporting partners. Sports such as baseball and soccer enjoy enormous followings in Japan, and a possible Japanese NFT-powered fantasy league could doubtless enjoy great popularity. However, Japanese anti-gambling laws, which outlaw most business activities that gather stake money from participants, could pose a problem for fantasy sports operators, some of which require participants to pay “entry fees”. To get around this, the white paper is likely to recommend that companies ask sponsors to provide prize money and prizes. The white paper will also seek to “clarify the regulatory environment” for NFT operators and sports teams and support the establishment of an “industry group” for firms that make use of NFTs. It will also request that the public and private sectors “work together to formulate guidelines”.
The Web3 team has noted that “fantasy sports” are “gaining popularity overseas” and wants to “encourage” domestic “companies” to “enter” the sector. However, working with overseas firms could be problematic, and if a Japanese sports organisation provides a license to an overseas business operator who uses it for gambling, it may be guilty of abetting gambling. To help domestic firms enter the sector, the white paper likely will seek to clarify the regulatory environment and promote the establishment of an NFT-based sports ecosystem in Japan.
The Web3 team works alongside a dedicated NFT taskforce that was launched in 2022. Around a year ago, the team recommended that Tokyo appoint a Web3 government minister. Prime Minister Fumio Kishida has repeatedly talked up the idea of developing the nation’s blockchain, metaverse, NFT, and crypto industries, underlining the nation’s commitment to Web3-powered business development at a meeting with UK-based investors last year.
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