The 1,300-year-old Kanda Myojin Shrine in central Tokyo, a 10 minute walk from the blaring neon of anime and tech shopping district Akihabara, provided an impressive backdrop for the daylong conference on Thursday.
Discussions included insider insights into building Web3, or the evolution of the current Internet into one built on decentralized blockchains that include virtual reality, cryptocurrencies and more. Other talks focused on the benefits of DAOs and the challenges in making them work.
Another backdrop for the event is the release a week earlier of a government-affiliated white paper calling for faster Web3 and DAO developments in Japan, a sign that Tokyo is joining its Asia financial-center rivals Hong Kong and Singapore in embracing digital asset industries. South Korea is also forging ahead with its own plans.
DAO’s are an “important part” of the country’s future, the white paper said, arguing the case that greater understanding of blockchain technologies and smart contracts employed in DAOs is needed in order to “unlock their potential” as a tool for regional revitalization and social engagement.
For event organizers Fracton Ventures, a Tokyo-based Web 3 incubator focused on DAO infrastructure development in Asia, the conference provided a rare opportunity to share ideas across what remains an East-West knowledge and capability divide.
“As an incubator, we want to increase the number of DAO contributors, particularly in Asia,” Fracton Co-Founder Yudai Suzuki said when opening the conference. “I still can’t believe this is happening here. This is Tokyo, not New York. At previous DAO conferences, 1% or 2% were from Japan, but here we have a huge mix of people, including attendees from all over Asia.”
The Japan government’s recent pivot towards Web3 and DAOs is a huge positive for the industry, Fracton’s Suzuki said in an interview at the event. But while that interest is leading to increased opportunity, he said the greatest potential is in the development of a community uniting Japan’s globally minded crypto natives.
This new generation is “open to communicate and open to connect globally,” he said, the ideas and technologies they are working on not just the “copy and paste model from San Francisco, but a complete change of mindset” to help the maturation of a Japanese Web3 ecosystem.
Catching up
Flying in from the concurrent Hong Kong Web3 Festival, APAC Growth Lead for MakerDAO Jocelyn Chang said she could feel the buzz generated by the event and the international crowd it had attracted to Japan.
However, the country has some catching up to do if it is to compete with neighbors Hong Kong and Singapore, she said, which have both fast-tracked development of a crypto regulatory framework with the aim of becoming the regional hub for the industry.
“Singapore has actually got an advantage and an edge because they started building their regulatory framework three years ago and now Hong Kong is pushing for it,” she said.
“It is still very nascent for Hong Kong, but it’s game changing because this is the first time that we’re seeing Hong Kong getting that soft backing from the Chinese government.”
In Japan’s case, she added, if the recent white paper works to kickstart the development of a regulatory framework, “I’m pretty sure that they can actually do something similar to what Hong Kong and Singapore did.”
The regional competition between Japan and its neighbors is something that Chelsea Kubo, co-founder and chief operations officer of DAO-focused development company Koris, feels could spur Japan to accelerate its Web3 plans.
Move fast
In an interview after speaking at a panel on DAO development, she said she could see Japan making efforts to keep up with its neighbors, capitalizing on its unique position as an Asian country aligned closely with economies in the West.
“But it’s a rough landscape out there,” she cautioned. “America’s becoming very tough on crypto as well as Europe, and so Japan might end up also tightening a little bit and might not be as progressive as we hear at this time. But we’ll have to see in the next couple of months to half a year how the narrative really starts to develop.”
In the meantime, events such as DAO Tokyo, by bridging the divide between East and West, represent nothing but upside after the crypto market pummelling of 2022, said Francesco Renzi.
The co-founder and CEO of asset streaming protocol Superfluid told Forkast that he feels such events are vital for connecting the international crypto community with local audiences.
“There are plenty of people in Japan who are working in DAOs and working around DAOs, but I would say at the moment that most of the expertise is still coming from the West,” he said.
“I believe that is set to change. A lot of the people I have been talking to are very excited to do more in Japan and there do seem to be some movements on the regulatory side to make that easier.”
Should that happen, he argued, it would be no great leap of the imagination to see Japan becoming a crypto hub in its own right.
“People are migrating based on what they need and that is usually regulatory clarity or tax rules. Those are the ways to attract a crowd and the crowd moves very quickly,” he said.