- Bitcoin took a dip to a low of USD 6,267 but continues a recovery trajectory
- Despite stricter crypto exchange regulations in Japan, crypto analysts believe that this will actually help the industry in the long run
- A more secure alternative to authentication in Lightning Network technology could replace obsolete and insecure website accounts
It is April Fool’s day today and Bitcoin has yet to play any funny tricks on anyone, with price on Tuesday trading largely following a pattern of minor spikes climbing onwards to higher gains. Today so far in Asian trading, the bears did successfully take down price in a steep move but only to make a daily low of USD 6,267 (CoinDesk), where price has now begun yet another walk to recovery at closer to USD 6,385.
Speaking of Asia, in Japan today a local game developer called Double jump.tokyo has launched a new law firm that will specialize in crypto and blockchain. Called So & Sato, the law firm has released a fresh report that covers all Japanese digital asset aspects, discussing crypto derivatives and tokenized securities.
Joerg Schmidt and So Saito, representing the firm, spoke to Cointelegraph Japan to say that Japan’s regulations regarding crypto exchanges were a lot stricter than those in other jurisdictions but that this conservative approach would bear fruits in the long term since traditional finance would be more encouraged to dip their toes. They explained:
“The market is highly regulated in Japan. What seems to be a regulatory overkill, at first sight, is likely to help the market to mature in the mid to long term. This will allow more institutional players to enter the market and to increase their stake in the digital asset space.”
In the country, crypto regulations fall under the purview of the Payment Services Act (PSA) and the Financial Instruments and Exchange Act (FIEA). These two acts also passed even stricter amendments that come into force next month. Among others, the new PSA regulations state that crypto exchanges must use third-party operators to keep custody of user funds, separating them from internal cash flow. Additionally, Japanese crypto exchanges must also get a license to operate from the Financial Services Agency (FSA), while foreign ones must also hold licenses from their home jurisdiction and from Japan. The full requirement is detailed as the following:
“To register as a crypto asset exchange [in Japan], companies must meet certain criteria. Local companies must be incorporated as a stock company and have a minimum capital of JPY 10 million. An exchange must further ensure that its net assets do not fall below the amount of users’ funds that are stored in a hot wallet.”
And there is bullish news coming from Bitcoin too, with Lightning Labs, who are working on an implementation of the second-layer protocol for Bitcoin called Lightning Network, now also announcing the specifications of a new Lightning Network-based authentication system.
If successful this new authentication could take the place of current website accounts using email. The Lightning Service Authentication Tokens (LSAT) would issue Lightning-based tokens for users once payment is received in Bitcoin, rather than give out personal information needed for email-based accounts.
These tokens would be like tickets for the paid resources, granting access to them. They can even be exchanged, revoked and modified, allowing for apps that charge users based on subscription plans instead of repeated upfront payments.
The secret behind this is the hypertext transfer protocol (HTTP) status code 402, which actually tells a browser when you need payments to access the service. It hasn’t been popular in use, unlike the status code 404, which tells a browser the resource can’t be found. Mozilla also hasn’t assigned a standard use convention for it. The explanation says:
“As the name entails, this code is returned when a client attempts to access a resource that they haven’t paid for yet. In most versions of the HTTP specification, this code is marked as being ‘reserved for future use.’ Many speculate that it was intended to be used by some sort of digital cash or micropayment scheme, which didn’t yet exist at the time of the initial HTTP specification drafting.”
Use case? We think so.
Image Courtesy: Pixabay