The Japanese government may push for the introduction of non-fungible tokens (NFTs) in the sports industry.
Nikkei reported that Tokyo could change after the ruling Liberal Democratic Party’s Web3 “Promoting Digital Society” team released a white paper on the issue.
The white paper has not yet been released, but sources appear to have discussed the issue in detail with the media.
Nikkei explained that the white paper aims to clarify the regulatory picture for firms issuing NFTs and their potential sports partners.
How can Japan use NFTs in sports – and what are the challenges?
The Web3 team noted that “fantasy sports” is “gaining popularity abroad” and wants to “encourage” domestic “companies” to “enter” this sector.
Sports such as baseball and football (soccer) have huge followings in Japan.
As such, any possible NFT-based Japanese fantasy league would certainly be highly popular.
However, Japan’s strict anti-gambling laws can be a stumbling block.
Japanese law prohibits most activities that collect money from participants.
This can pose a problem for fantasy sports operators using NFTs, as some require participants to pay “entry fees”.
Working with foreign firms can also be problematic.
Japanese media outlet CoinPost explained:
“If a Japanese sports organization grants a license to a foreign business operator and it is apparent that the license is being used for gambling, it may be guilty of the crime of abetting gambling.”
The white paper is likely to recommend that companies get around this by asking sponsors to provide prize money and prizes.
The document will also aim to “clarify the regulatory environment” for NFT operators and sports teams.
The team will also support the creation of an “industry group” for companies using NFTs.
It will also require the public and private sectors to “work together to formulate guidelines”.
The Web3 team is working alongside the NFT Task Force, which was launched in 2022.
About a year ago, the team recommended that Tokyo appoint a government minister for Web3.
Prime Minister Fumio Kishida has repeatedly expressed the idea of developing a national industry of blockchain, metauniverse, NFT and even crypto.
Last year, at a meeting with British investors, he emphasized the country’s commitment to business development based on Web3.
