An official of Japan’s Financial Services Agency (FSA) has suggested that Asia should be making best use of technological innovations such as the blockchain and distributed ledger technologies.

Masamichi Kono, Vice Minister for International Affairs, FSA, made these comments as part of a keynote address at the OECD-ADBI Roundtable on Capital Markets and Financial Reform in Tokyo last week.

Kono said that the financial system in Asia has been traditionally dominated by banks, with the banking system at the core of the channels for financing growth and development. He went on to suggest a number of regional strategies for Asia for growth finance such as a more balanced financial system, bigger role of asset management, financial inclusion and more. In addition, he said:

“An area of strength for Asia may be in making the best use of technological innovations. Particularly for those ‘disruptive technologies’, including distributed ledger and blockchain technologies, Asia has a competitive edge, and should be in a position to be able to deploy those new tools in financing growth in the region in a more cost-effective yet safe manner.”

He added that confidence in markets is the key and a well-regulated financial market equipped with measures to enhance transparency and accountability of firms, progress in improving corporate governance and consistent implementation of accounting standards, will contribute to these strategies.

In his concluding remarks, Kono said, “I believe Asia can do much better in leading the global quest for building financial systems and markets that will support sustainable growth and development.”

Earlier this month, Nikkei reported that the Japanese government intends to bring cryptocurrency exchanges under Financial Services Agency (FSA), in order to prevent money laundering and ensure protection of the cryptocurrency users.