Tokyo (IANS) - People in Japan can now pay in restaurants and shops and also settle their utility bills using bitcoins, a digital currency that Tokyo legalised as a valid form of payment along with other digital monies.
The law, the first of its kind in the world, came into force in April and led to a surge of the value of bitcoins, which Japanese firms and users have enthusiastically embraced, reports Efe news.
Up to 300,000 commercial establishments in the archipelago are expected to begin accepting bitcoin payments this year.
The new law is aimed at regulating digital currencies to protect consumers and businesses and prevent their use in money laundering, terror funding or other unlawful activities, a spokesperson for the Financial Services Agency told Efe. The bitcoin explosion in the planet's third largest economy has pushed up its listed value to record levels.
On May 25, it exceeded $2,700 — making yen the most-traded currency for bitcoins, overtaking the dollar and the yuan, said London-based digital currency analytics platform Cryptocompare.
This cryptocurrency — a method of payment that is backed by its value in data encryption — has risen 575% in a year and 150% since April.
In late May, the price of this stateless currency (not regulated by any central bank or monetary authority), surpassed the historic high of an ounce of gold for the first time, with other more recent virtual currencies like Ethereum following suit.
"Bitcoin has reached a new level thanks to its new legal status in Japan. It has strengthened trust in a currency not so long ago regarded as a risk investment," said Charles Hayter, CryptoCompare CEO. Low cost airline Peach and popular electronics chain Bic Camera are some of the Japanese firms accepting bitcoins.
Processing bitcoin payments is much faster and cheaper as compared to credit cards, underlines the owner of Tokyo's Numazuko Ginza sushi eatery, Ken Nagahama, who has seen a marked rise in guests who prefer to pay with bitcoins.
Large corporations too are showing growing interest in bitcoins, says Kagayaki Kawabata, business director of the exchange and e-payment company Coincheck.
"Before money took its current form, it was something completely different such as a shell or a rock. Currencies have value since everyone believes it has a value. Digital assets may replace current currencies, just like current currencies had once replaced shells and rocks," Kawabata added.
Japan's bitcoin rush is surprising given the country still largely prefers cash transactions and where many shops still do not accept credit cards.