Written by Manabu Bannai

I'm a Japanese influencer. I stop tweeting in Japanese, but in English.

Hi, I'm Manabu.
A few days ago, I tweeted like below:

This is happening in Japan.
In addition, Japanese entrepreneurs go abroad:

I'll translate the above because it's in Japanese. Sota Watanabe, a founder of @AstarNetwork, says:

Starting a web3 firm in Japan is like to battling international athletes in suits and leather boots; It isn't possible.

This article will dive into the detail.

Table of contents

1. The reason why Japanese entrepreneurs go abroad

The reason why Japanese entrepreneurs go abroad

There are three reasons, in my opinion:

(1) Crypto Tax is too expensive

Japan's crypto tax is too expensive. It can go up to 50%. You must also pay tax while exchanging your coins. For example, If you convert BTC to ETH, you will have to pay taxes.

As you know, this tax structure is almost impossible to implement in DeFi areas. Because how do you calculate your payable tax event when you use Uniswap and then provide liquidity?

I think the Japanese government will change the tax policy, but the debate speed is really slow. That's why Japanese entrepreneurs went abroad.

(2) Government has no strategy

It's similar to the previous one I mentioned. Also, there is a bad culture in Japan that is the behavior of blocking new technology first and then reconsidering it later.

This behavior will lead to a competitive disadvantage. Because they always block the new technology first, which means entrepreneurs in that field have no choice but to stop their business.

Stablecoin Restrictions

According to the news media, The Berge, says:

Japan is proposing new restrictions that would only allow banks and wire transfer services to issue Stablecoins, first reported by Nikkei Asia.

I don't know enough about politics to make an argument, but the Japanese government always follows the American government.

I think it's fine, but the problem is there is no discussion between entrepreneurs and the government. I'm trying to say is as follows:

Congress to hold hearing with execs from Coinbase, FTX, Paxos and others – The Block

There are many discussions in the US, right? We also need a discussion with the government. They, however, do not. I'm don't know why.

Another example of blocking new technology in Japan; it's surprising, but there is no Uber Taxi app in Japan. Actually, there is one like it, but the quality is very low in comparison to Uber.

I'm currently living in Thailand but I visit Japan on occasion. When I try to call a taxi in Japan using the local app, it takes more than 20 minutes. Sometimes, there is no taxi at all. What's worse, it's expensive.

(3) No future in Japan (maybe)

This is the worst part, I guess. Please see the following:

USD_JPY_chart

The value of the Japanese yen has plummeted dramatically. Also, there are other data worth attention to:

Japanese_workers_wages

As you can see, the wage for Japanese workers has flatlined since 1990. This is true, and to make matters worse, the wealth gap is widening these days.

One hope is that there are several people who study by themselves and make a relatively high income compared to the average. However, these kypes of people tend to go abroad due to Japan's high taxes; income tax in Japan can reach up to 55%, and crypto tax is also the same.

What's worse, the Japanese government is considering increasing financial tax in the near future. What the heck is this? I don't understand their strategies. That's why I went abroad.

The problem of Japanese VCs

I worked in the industries in 2013. I was in Tokyo at the time, and there were many VCs and startups, such as Mercari, one of Japan's most popular shopping apps.

I think it was the final golden period of Japanese startups and venture capitalists. Because right now I don't think there is enough discussion about Web3 and Crypto in the Japanese VC market.

A few of them have begun to discuss it, but I think it's a bit slow. After two large waves of NFTs in 2021, the conversation among VCs began.

However, I don't blame VCs directly because of Japanese legislation.

As I said earlier, the Japanese government lacks a strategy, so there is a powerful barrier to beginning to invest in Japanese web3 companies as Japanese VCs.

Especially it related to Token. The government has had no meaningful discussion about investing in tokens, whether legal or not.

Ref: NFTs in Japan

For your reference, there are several NFT projects in Japan even though high tax rates.

Crypto Ninja

This is, in my opinion, one of the largest NFT projects in Japan. The most exciting aspect is their funs' derivative work:

This kind of culture is interesting and glowing only in Japan. If you want to learn more, follow @IHayato, a founder of Crypto Ninja.

TokyoPop Girls Collection

Another well-known NFT creator is Onigiri Man. She is one of Japan's first NFT creators; I guess she began her work in August 2020.

Tokyo_Pop_Girls_Collection_by_Onigiriman

One of the most notable projects is Tokyo Pop Girls Collection, which earned nearly $300,000 in the first four hours after its release. If you want to learn more, follow @onigiriman1998.

2. This divide will create a huge gap in the near future

This divide will create a huge gap in the near future

There are two important factors:

(1) English Skill

People with English skills have more options for where to work. People in Japan, however, have no choice but to work in Japan if they do not speak English.

Again, please take a look at the chart below:

USD_JPY_chart

Working in Japan and saving JPY means all in one beting in the Japanese market. But,,, unfortunately, how come Japan will win the next economy? The other Japanese also agree with my opinion, sadly.

So what I want to try to say here is that English skills will cause a huge income gap in the near future. People who can speak/write English will have tremendous choices in raising the global job market, thanks to Covid, which accelerate the shift.

What's worse, Japanese companies are gradually shifting remote work, bringing in new competitors for Japanese labor; overseas workers who are satisfied with relatively low salaries.

That's why I have switched my primary language from Japanese to English, even though I have around 800k followers on the Japanese-speaking market.

The problem of English education

It's surprising to you, but there are nine years of English educational calcium in Japan. But,,, unfortunately, majority of Japanese people can't speak English.

Because we were only taught grammar in school. We understand English grammar. That's all🤯

(2) Remote Work

Remote Work is another key factor in the income gap in the near future. As I mentioned earlier, the wage for Japanese workers has flatlined since 1990:

Japanese_workers_wages

Also, the salary of programmers in Japan is low because of Japanese culture, which is a culture that the manager is regarded as more important than the programmer. That is why a high-level manager will not study programming.

They are outsourcing programming tasks to subcontractors. Furthermore, subcontractors are attempting to extend the time it takes to create. Because the longer it takes, the more sales they make. *They are hourly workers.

Better to work in foreign companies

Given these circumstances, it's better to work in a foreign company than the Japanese one. Most Japanese people tend to choose Japanese companies because of the language. Lacking English skills prevent people from leaving. However, I believe this will change due to two factors:

It will not be a drastic change, but it will occur gradually. The majority of Japanese people are unaware of this trend, but I am confident that it will occur because it is the best strategy for Japanese people to seize an opportunity.

What can I do for japan?

Again, I've tweeted like below several days ago:

And I received a reply from a foreigner living in Japan:

I appreciate that opinion, and I also want to support Japan for sure because my parents, as well as my big brother, his wife, and their children, live there.

But, unfortunately, I have no influence over Japanese people to study English more and try to work abroad. I can create many articles about that to increase the sense of danger, but it never pays off considering my marketing perspective.

Things to do: Make achievements

Making some achievements in the global market as a Japanese is one of the most difficult but influential actions. So that's what I'm trying to do.

After that, I think I can write some books or video materials to educate Japanese people about global challenges.

The more Japanese go abroad, the more possibilities for change will happen in Japan. We can't change Japan internally, but I believe we can change it externally.

Summary:

Thanks for reading my article. Here is the summary:

Okay, that's all for my blog.

If you have any questions or some suggestions for the next blog, please feel free to let me know via Twitter. A conversation will deepen the thought of people. I like to discuss. Thanks!