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Banking & Finance

Bitcoin getting interest-paying accounts in Japan

Online services provider GMO Internet also launching bitcoin exchange

TOKYO -- Japanese bitcoin holders will soon be able to reap virtual interest, as domestic exchange Coincheck is launching the country's first interest-paying fixed deposit accounts for the digital currency.

The Tokyo-based Coincheck will offer four plans, letting users deposit their currency for 14 days at a 1% annual interest rate, 30 days for 2%, 90 days for 3%, or a full year for 5%. So an account holder depositing 10 bitcoin ($15,956) for 90 days would earn roughly 0.07 bitcoin.

Hundreds of thousands of Japanese are said to have some bitcoin to their names, but many apparently let the currency gather digital dust. The ability to earn interest on their holdings may prove attractive.

The Financial Services Agency says Coincheck's deposit service is exempt from banking regulations and recent revisions to fund settlement law, as bitcoin is not legal tender. But should the number of users rise suddenly or the currency gain widespread traction as a method of payment, such services could face regulation in the future.

GMO Internet launches new bitcoin trading platform Coin, an affiliate of Japanese online services company GMO Internet, will also launch May 24 an online trading platform for bitcoin, letting users buy and sell the currency directly as well as with leverage in a method akin to foreign exchange trading. The operator expects domestic users to grow as the government works through legislation on the virtual currency.

Users will be able to preregister for the trading site starting Tuesday. At launch, they will be able to trade the currency for yen, as well as via derivatives called contracts for difference. In CFDs, buyers deposit money with the exchange operator and when a trade is executed, one side pays the other the difference between the initial and final prices, depending on which way the price moves. Buyers will be able to leverage their investment up to five times. Coin's site will serve Japan at first, but the operator hopes to expand to other Asian countries.


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