Investors3
2 years ago
Why investing in the Japanese yen will always be a good idea
NEWSONJAPAN.COM -- MAR 04
For many years now, Japan has been the 3rd largest economy in the world, with a GDP of over 4.872 trillion back in 2017.
Since then, it is estimated the GDP has increased by another trillion. Besides being amongst the countries with the largest economy in the world, Japan is also known as the world's largest creditor, which has turned the Japanese yen into one of the most important currencies in the world.
For decades now, the Japanese yen has been considered the proxy for Asia. If you watch the news, you will soon start to see that, anytime something of political or economic importance happens in Asia, investors will start discussing their opinions in relation to the Japanese yen, even though the problems are not happening in Japan.
Many investors consider the Japanese yen an investment safe haven, which quickly turned it into the 3rd most traded currency in the forex market, after the U.S. dollar and euro. But that is not the only reason the Japanese yen makes for such an important investment. A number of economic decisions have made the currency extremely sought after, not only in the foreign exchange market but in other types of investments as well. Below we will be discussing the most important reasons you should consider Japanese yen for your next investments.
Japan's zero rate interest
When Japan first introduced the zero interest rate policy, many viewed it poorly, and critics still argue it has not done much to stimulate the local economy, but now, a number of other countries are starting to consider it as well.
The Bank of Japan introduced the zero interest rate policy 21 years ago and was perceived at the time as a very unusual strategy for Japan. That, until 2008, when the financial market conflagration forced both the European Central Bank and the U.S. Federal Reserve to consider similar methods.
Even though zero interest rates may not be the best policy to boost inflation, many other European countries are now experimenting with it to encourage individuals to borrow and invest money.
A popular currency to fund businesses
The country's zero interest rates made the Japanese yen an extremely popular funding currency for many. It costs extremely little to borrow yens, which makes it an attractive tool to fund currency purchases, with many believing it played an important role 12 years ago, during the recession.
As other countries are beginning to follow in Japan's footsteps, experts are predicting a new wave of investments that are funded with low yield currencies.
Because the yen is such a popular funding currency, uncertainty in other financial markets tend to drive the yen higher against currencies such as the U.S. dollar or euro. This is why, during a market crash, people can expect the yen to rise quite fast. This is why the Japanese yen can be used to measure the market's risk tolerance as well.
How to invest in the Japanese yen
More than a decade ago it became a very popular practice amongst investors to borrow Japanese yens from the Bank of Japan, then further lend the money in currencies such as euros or U.S. dollars at much higher interest rates. This hurt the export sector quite considerably, until 2013 when Prime Minister Shinzo Abe was elected and managed to bring down the yen's valuation.
Now, the situation is a bit more different and investors are looking for long-term ways to invest in yens. If you are wondering how you can invest in the Japanese yen, here are some options to consider:
The forex market
The forex market is the largest financial market in the world, with over $5 trillion traded daily. 80% of that amount is accounted for by just 7 major currencies, and the Japanese yen is one of them. The number of forex brokers based in Japan is increasing, but so is the number of retail traders. This happens because experienced traders are looking to increase profits by buying currencies with high leverage.
The Japanese yen is mostly traded against the U.S. dollar, making the USD/JPY, making it the second most traded currency pair in 2019, after the EUR/USD. In total, it accounted for 13.2% of daily transactions last year.
Exchange-traded funds (ETFs)
This is considered one of the easiest ways to invest in the Japanese yen, especially if you are an international investor. ETFs attempt to mirror the price of the Japanese yen against the U.S. dollar or any other currency, which makes it easier for investors to plan their next moves.
Some funds also provide options for investors to capitalize on the currency's movements in a number of ways. Even though there are a number of Japanese ETFs investors can consider, the ProShares UltraShort Yen (YCS) and CurrencyShares Japanese Yen Trust (FXY) are the most popular ones, reaching, together, over $640 in total assets.
Stocks and Bonds
Another way to invest in the yen, but without actually owning currency, is by buying Japanese-owned companies' stocks or bonds. The yen often appreciates against the U.S. dollar, boosting stock prices. Companies such as Mitsubishi, Toyota, Nissan, and Matsushita are the ones investors prefer most. If you are considering debt instruments, Japanese government bonds are another option, as their prices usually reflect the current state of the country's economy.
Futures
Futures have a set expiration and a fixed strike price, which allows you to speculate on the yen's activity. But yen futures do have a considerable degree of leverage, meaning you can often be at risk for significant losses. The best way to do this is by working with a professional who has learned the market and can help you make a profit.
Ideally, if you are a trained investor, you can use the potential leverage to buy and sell options on yen futures contracts to make profits fast. But this involves knowing the market very well and being able to speculate on prices.
https://newsonjapan.com/html/newsdesk/article/126493.php
Investors3
2 years ago
INX Limited partners with Japanese Financial Giant GMO Internet Group to bring NYDFS Regulated Stablecoins to Retail and Institutional Investors
GMO-Z.com Trust Company
Sep 23 · 4 min read
INX Limited (INX), the owner of a regulated cryptocurrency exchange and a digital security trading platform, has partnered with GMO-Z.com Trust Company, Inc. (GMO Trust), to list the world’s first regulated Japanese yen stablecoin, GYEN, for retail and institutional investors through its subsidiary, INX Digital, Inc. (“INXD). INXD will also be listing GMO Trust’s USD-backed stablecoin, ZUSD.
GMO Trust is the New York-based, regulated stablecoin subsidiary of Japanese financial services and internet conglomerate, GMO Internet Group (GMO Group). GMO Group owns and operates the world’s largest online FX trading platform by volume, a Japanese regulated internet bank, a cryptocurrency exchange, a cryptocurrency mining operation and a payment gateway service.
GMO Click Securities, the forex arm of GMO Group, has been ranked the largest forex broker in the world by volume for the majority of the last decade, with volumes consistently surpassing $1 trillion dollars a month¹. To expand GMO Group’s cryptocurrency footprint, GMO Trust was established as a limited purpose trust company regulated in New York and launched GYEN and ZUSD.
Daily FX turnover is approximately over $6.6 trillion a day, with the US Dollar against the Japanese Yen (USDJPY) being the second most traded currency pair after the Euro against the US Dollar (EURUSD). The introduction of this Japanese Yen stablecoin on INXD provides an innovative asset class and new trading venue with no closing times for the millions of retail, and thousands of institutional FX traders to invest and speculate. It also provides corporate clients an innovative, more efficient Japanese Yen-backed payment solution, with instant settlement in digital wallets as opposed to the traditional market T+2 experienced in the underlying asset.
GYEN and ZUSD will initially be traded against the US Dollar and Bitcoin, with additional pairs added in the future, and unlike traditional FX markets, this digital version will be open on weekends and holidays too!
Stablecoins are already seeing traction as an alternative payment method with the issuance of over $113 billion in stablecoins. Earlier in 2021, the Office of Comptroller and Currency, the US federal banking regulator, affirmed that banks may use stablecoins to facilitate payments to customers noting the speed and efficiency of such instruments relative to more traditional payment methods.
“INX is proud to partner with GMO, a global financial services powerhouse that is issuing financial-grade stablecoins.” Shy Datika, founder and CEO at INX said, “GMO has a very synergistic portfolio of businesses that directly aligns with our customer base, which we are ideally positioned to service on the digital asset side as a US regulated cryptocurrency platform. To put it into perspective, daily turnover in Bitcoin is around $40 Billion, while in USDJPY it is closer to $750 Billion. We are very excited to finally close the gap between the FX and cryptocurrency worlds.”
“GMO’s new stablecoins, including the first regulated Japanese yen stablecoin GYEN, demonstrate our firm belief that tier one institutional traders are ready to embrace innovative digital assets,” Ken Nakamura, CEO of GMO Trust said. “We’re thrilled to bring these stablecoins to INX’s industry-leading exchange, which is built in accordance with top U.S. regulatory standards. Traditional FX brokers are actively exploring 24/7 digital FX through the utilization of stablecoins. We’re confident that the INX platform will attract the largest financial firms with its advantages in compliance, safety and technology.”
Institutions and corporate treasuries looking to connect and trade the GYEN and ZUSD on INXD are able to onboard here.
Retail investors are encouraged to sign up here.
* Please note that due to regulatory restrictions, GYEN and ZUSD will not be offered to Japanese residents.
¹ Sources: https://forex.z.com/hk/en/press/2019/826/ ; https://www.financemagnates.com/forex/brokers/japanese-gmo-click-securities-breaks-one-trillion-barrier-in-2020/
GMO Internet Group and GMO Trust
GMO Internet Group, based in Tokyo, is a global market leader in the Internet infrastructure, Internet finance and the digital asset space since its inception in 1991. It operates the world’s largest online FX trading platform, an Internet bank, a cryptocurrency exchange, a cryptocurrency mining operation, a payment gateway, and regulated stablecoins. GMO Internet, Inc. (TSE: 9449) is headquartered in Tokyo, Japan. For more information, please visit https://www.gmo.jp/en
GMO Trust, based in New York, is a Limited Purpose Trust regulated by the New York Department of Financial Services. Issuing the world’s first regulated Japanese Yen stablecoin, GMO Trust also offers a USD stablecoin “ZUSD” and a stablecoin-as-a-service technology and custody product suite. GMO Trust is on a mission to bring traditional finance into the digital age with blockchain services. For more information on GMO Trust, please visit https://stablecoin.z.com
INX Limited
INX Limited launched the first SEC-registered digital security initial public offering (IPO) for both retail and institutional investors. INX is uniquely positioned to offer retail and institutional investors and traders access to both digital securities and cryptocurrencies through both of its trading platforms.
INX’s vision is to be the preferred global regulated hub for digital assets on the blockchain, offering technology and related services for both primary and secondary markets. INX’s overall mission is to bring communities together and empower them with financial innovation. INX’s journey started with its IPO of the INX Token and raising $83M from the IPO and now operates 2 regulated trading platforms for blockchain assets and its interdealer broker plans to offer non-deliverable cryptocurrency forwards to Tier-1 banks in the near future. The INX Token has the largest market capitalization of US-issued digital securities, with the largest daily volume. The INX Token is available for trading, including for Japanese residents, here. INX is shaping the blockchain asset industry through its willingness to work in a regulated environment with oversight from regulators like the SEC and FINRA. For more information, including the INX Token, please visit the INX website here
https://medium.com/gmo-z-com-trust-company/inx-limited-partners-with-japanese-financial-giant-gmo-internet-group-to-bring-nydfs-regulated-27502fc8f83c
Investors3
2 years ago
Asia Cryptocurrency Titans, GMO Internet Group and Liquid, Partner to Create the First Synthetic JPY FX Instruments
NEWS PROVIDED BY
GMO Internet Group
Mar 03, 2021, 08:55 ET
NEW YORK, March 3, 2021 /PRNewswire/ -- GMO-Z.com Trust Company, Inc. ("GMO Trust"), the New York-based, regulated stablecoin subsidiary of Japanese financial services and internet conglomerate GMO Internet Group, and Liquid ("Quoine Pte. Ltd."), one of the world's largest cryptocurrency-fiat exchange platforms (ranked among the top 10 regulated cryptocurrency exchanges globally), today announced its partnership to bring "GYEN," the world's first regulated Japanese yen (JPY) stablecoin, and U.S. dollar (USD) stablecoin "ZUSD" to Liquid's exchange to create the first synthetic, fully digital USD/JPY pair.
Regulated Stablecoin Clearinghouse for World's First Synthetic, Digital USD/JPY Pair
Liquid is set to launch a new clearinghouse for regulated, global fiat-backed stablecoins to support growing demand for stablecoin swaps, FX trading, and expansion of digital fiat onramps/offramps. Trading pairs featuring stablecoins and other popular tokens such as Bitcoin (BTC) and Ethereum (ETH) have increased dramatically in popularity this year, however, the market is missing a clearinghouse to easily swap between stablecoins backed by major global currencies. As two of the largest digital asset companies in the Asia-Pacific (APAC) region, Liquid has entered a strategic partnership to leverage GMO Trust's regulated, financial-grade GYEN and ZUSD stablecoins to create the first synthetic, digital USD/JPY pair, the second most-traded forex pair in the world.
Combining into Single Order Book:
Liquid positioning GYEN with the same standing as JPY fiat
Liquid currently has the largest BTC/JPY market globally, consistently averaging $300 million in volume every 24 hours. Given the demand in the marketplace for a digital version of JPY, the exchange has decided to combine its BTC order book with GYEN/JPY, which will optimize liquidity and provide a fully digital way to access this market. Users depositing GYEN on Liquid's exchange will be credited 1:1 with JPY. This provides significant potential to connect local traders who leverage JPY with global cryptocurrency traders. Learn more here about GYEN and ZUSD listing on Liquid.
Quotes:
"Liquid recognizes that until now, there has not been a regulated, fiat-backed digital version of JPY, which is our top fiat market," said Seth Melamed, COO of Liquid. "Unifying our BTC/JPY order books with GYEN is set to increase global participation and liquidity, with traders enjoying the speed and efficiency offered by improved digital fiat options."
Marisa McKnight, Head of Partner Solutions at Liquid, commented "Creating a marketplace to actively trade regulated stablecoins brings us closer to capturing a purely digital version of FX, which provides new opportunities to our trading partners."
"Our partnership with Liquid integrates GYEN into the largest BTC/JPY liquidity pool in the space, providing incredible depth to this market," said Ken Nakamura, President and CEO of GMO-Z.com Trust Company, Inc. "We are excited to expand the digital asset market with financial-grade stablecoins, while also having them be seamlessly traded with other digital currencies."
Please note that due to regulatory restrictions, GYEN and ZUSD will not be offered to Japanese residents.
About GMO Internet Group and GMO Trust
GMO Internet Group, based in Tokyo, is a global market leader in the Internet infrastructure, Internet finance, and the digital asset space since its inception in 1991. It operates the world's largest online FX trading platform, an Internet bank, a cryptocurrency exchange, a cryptocurrency mining operation, a payment gateway, and a regulated stablecoin. Parent company GMO Internet, Inc. (TSE: 9449) is headquartered in Tokyo, Japan. For more information, please visit https://www.gmo.jp/en/.
GMO Trust, based in New York, is a limited purpose trust company, regulated by the New York Department of Financial Services. Issuing the world's first regulated JPY stablecoin "GYEN," GMO Trust also offers a USD stablecoin "ZUSD." GMO-Z.com Trust Company is on a mission to bring traditional finance into the digital age with blockchain services. For more information on GMO-Z.com Trust Company, Inc., visit https://stablecoin.z.com/.
About Liquid
Founded in 2014, Liquid is one of the world's largest cryptocurrency-fiat exchange platforms serving millions of customers worldwide. Liquid is consistently ranked among the top 10 regulated cryptocurrency exchanges globally based on daily traded spot volume with deep BTC/JPY liquidity, offering one of the best user experiences in service levels & security in the industry. Liquid proudly serves its customers from all around the world. Since we hit our first milestone of 100,000 users on 08 December 2017, we have continued to grow ever since. For more information on Liquid, visit https://www.liquid.com/.
Press Inquiries
Ryan Graham
JConnelly
TEL: 862-777-4274
Email: RGraham@jconnelly.com
GMO Trust
GMO-Z.com Trust Company, Inc.
Email: pr@gmo-trust.com
Liquid
Marisa McKnight
Email: marisa.mcknight@liquid.com
Copyright (C) 2021 GMO-Z.com Trust Company, Inc. All Rights Reserved.
SOURCE GMO Internet Group
Related Links
https://www.gmo.jp/en/
https://www.prnewswire.com/news-releases/asia-cryptocurrency-titans-gmo-internet-group-and-liquid-partner-to-create-the-first-synthetic-jpy-fx-instruments-301239546.html
Investors3
2 years ago
Currencies
Analysis: Japan keen to speed up digital yen launch as China adds geopolitical twist
By Leika Kihara
TOKYO, Dec 1 (Reuters) - Japan's new political leadership is calling on the country's financial bureaucrats to ramp up efforts toward issuing a digital currency, pointing to China's far quicker progress as a potential challenge to the global economic order.
The government has increased staff looking into legal and technical aspects of issuing a central bank digital currency (CBDC), which are digital forms of existing currencies.
While the political attention has yet to translate into any other direct investment, it is also likely to keep the Bank of Japan (BOJ) under pressure to shift away from its cautious, baby-step approach toward issuing a digital yen, analysts say.
"We must think about what could happen to Japan's national security if other countries move ahead on CBDC," said Takayuki Kobayashi, a minister overseeing economic security - a new role created under Prime Minister Fumio Kishida's administration.
"Japan must speed things up so it's ready to issue a digital yen any time," he said.
A global front-runner, China has already run tests in major cities for a possible launch of a digital yuan next year. Japan, along with other G7 advanced nations, have moved much slower.
The BOJ only started the first phase of its experiment in April, and says it has no immediate plans to issue a digital yen. Pilot programmes, if any, won't take place until 2023 at the earliest.
That lukewarm stance may be put to test as Kishida has made economic security a policy priority, and framed questions around CBDC beyond finance into one of national security.
While G7 central banks generally agree on the need to counter China on issues around privacy, the case is particularly strong for Japan as lawmakers worry about the growing economic might of its assertive neighbour.
Some influential ruling party lawmakers see China's advances on CBDC as a potential threat to the dollar's status as a global reserve currency, and the financial dominance of Washington - Japan's biggest ally.
A close aide to Kishida told Reuters Japan must "work closely with the United States to counter any attempt that threatens the dollar's reserve-currency status," adding the BOJ was coordinating with the finance ministry to ensure speedy progress for issuing a digital yen.
Opposition parties have also called in their election campaign platforms for speeding up CBDC plans.
BOJ officials say China's plan won't directly affect the timeframe for their CBDC experiments as the key purpose of issuing a digital yen is to provide convenient, efficient payment and settlement means to the public.
What could affect the BOJ more than China's plan would be how quickly its European and U.S. counterparts announce plans for issuing CBDCs, say sources familiar with its thinking.
Debate over issuing a digital yen may intensify next year as Kishida's administration lays out details of its economic security plans, and as China is seen promoting its digital yuan at the Beijing Winter Olympic Games in February.
"It's clear Kishida's administration and his ruling party are keen on issuing a digital yen," said former BOJ board member Takahide Kiuchi, who is currently an economist at Japan's Nomura Research Institute.
"If China launches a digital yuan next year and Europe's central bank announces plans to issue a digital euro, that will have a huge impact on Japan and pile pressure on the BOJ."
Reporting by Leika Kihara; Additional reporting by Kaori Kaneko and Tetsushi Kajimoto; Editing by Kim Coghill
https://www.reuters.com/markets/currencies/japan-keen-speed-up-digital-yen-launch-china-adds-geopolitical-twist-2021-12-01/
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