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Since Japan designated Web3 as a “national strategy,” an increasing number of traditional companies in the country have either merged or are contemplating integrating their businesses with Web3, Jangdeok Ko, the CEO of the non-fungible token (NFT) marketplace SBINFT, has said. Ko conceded however that many of these companies are still in the “trial-and-error stage,” as they continue to explore the most effective ways to incorporate Web3 into their operations.
Japan Takes the Lead in Promoting Web3
The SBINFT chief also attributes the growing interest of traditional corporations in Web3 to the Japanese government’s promotion of the technology and its ambition to become a global leader in the Web3 space. In fact, according to Ko, Japan is already ahead of many other countries in promoting Web3.
Despite its adoption by traditional companies, the Web3 industry continues to grapple with the issue of piracy, a problem that has plagued the sector since 2020. Commenting on the problem, Ko told Bitcoin.com News that the ease with which NFTs are minted has exacerbated the problem. While technological advancements have somewhat mitigated the problem, these have failed to eliminate it, the CEO said.
In responses provided to Bitcoin.com News via Telegram, Ko, shed light on why SBINFT, which was acquired by the Japanese financial services giant SBI in September 2021, concentrates on NFT tickets, characters, and games. The CEO also discussed measures his company has implemented to tackle the issue of NFT piracy. Following are Ko’s responses to all the inquiries posed.
Bitcoin.com News (BCN): Can you briefly talk about how Japan’s blockchain gaming ecosystem is evolving and the key factors driving the recent momentum? Also, can you tell our readers what it would take for the country to become a globally competitive Web3 hub?
Jangdeok Ko (JK): Japan has produced a variety of globally popular characters in the field of video games and anime. However, companies that produce such IP are still very cautious about the blockchain ecosystem.
On the other hand, IP-producing companies are still searching for the ideal tokenomics based on cryptocurrencies and NFTs to succeed in the blockchain gaming market, which could also be the next-generation gaming market.
Square Enix, SEGA, and Bandai Namco Entertainment are particularly active in Tokenomics. They have partnered with the OASYS chain, a game-specific chain from Japan, and are taking on the challenge of creating next-generation Tokenomics-enabled blockchain games.
Furthermore, the entry of these major game makers has stimulated the market, and Japanese venture companies are all entering the blockchain game market. Most of them are preparing for the OASYS ecosystem.
We at SBINFT are also working to expand the market by partnering with them as a leading NFT marketplace in Japan that can be comfortably used by a wide range of companies, from large corporations to venture companies.
In addition, in order for Japan to become an international Web3 hub, it is necessary to first define detailed rules regarding crypto assets and equivalent tokens, and to create a situation where global companies can easily expand their business in Japan.
In Japan, the government and the private sector are actually more advanced in promoting Web3 than anywhere else in the world.
BCN: In your opinion, how inclined are the traditional companies in Japan to explore Web3 and why did the SBI Group, Japan’s largest financial conglomerate, venture into the NFT industry with SBINFT?
JK: Web3 has been positioned as a national strategy, and many companies are paying attention to it. Therefore, many companies, even traditional companies, are considering combining their own business with Web3. However, many are still in the trial-and-error stage of figuring out how to combine their own business and Web3.
The SBI Group provides comprehensive financial services based on the Internet. It has a culture that differs from that of traditional financial institutions and is characterized by speedy business development, in addition to strategies that capture current trends and respond to change. In particular, in the area of fintech, where technological innovation is advancing day by day, we are actively promoting the use of and investment in AI and blockchain.
The SBI Group also aims to develop businesses that go beyond finance with finance at their core, and in particular, in the business area of digital space centered on blockchain technology.
In the process of developing a diversified business through group companies such as SBI VC Trade Co., Ltd., which operates a crypto asset exchange, and SBI Art Auction, which conducts art auctions, the Group was also considering entering the closely related NFT service. To this end, it acquired SBINFT (formerly Smart Apps, Inc.) in September 2021 and entered the NFT marketplace business as well.
BCN: Given the Japanese government’s support of Web3, a lot seems to be going right for the country to become a Web3 innovation hub. Could you shed light on the other side of the coin, that is, the challenges and risks that you think could derail Japan’s Web3 progress?
JK: Japan has been very active in becoming the first country in the world to promote Web3 through government initiatives. The driving force behind these efforts is simply to become a leading player in the new era on which Web3 is based.
The Web3 Project Team, chaired by a member of the House of Representatives and including members from the private sector, experts, and lawyers, was established within the ruling government party and released a Web3 White Paper last year. The contents of the Web3 White Paper have also influenced the policy of the Japanese government. The team will continue to take the lead in actively promoting the project.
Therefore, there are no issues that derail progress at this time, but rather we are working positively enough to be able to resolve issues that other countries are facing.
BCN: Your new SBINFT Mits platform is reportedly trying to simplify the daunting “Wild West” of the blockchain for traditional companies. Could you talk about how SBINFT Mits goes about helping the old-school brands embrace Web3?
JK: For companies, starting a project involving new technology or implementing new tools is challenging. In particular, starting an NFT project requires specialized knowledge and, in many cases, a wide variety of tools. Therefore, there are cases where the introduction of NFT projects has not progressed due to concerns about the loss of operational efficiency caused by the dispersion of management tools.
On the other hand, in the field of NFT projects by companies, there is a need for a one-stop Web3 service that maintains operational efficiency and can generate synergistic effects with the company’s products and services.
SBINFT Mits is a comprehensive NFT management support service that provides one-stop support for NFT issuance, community formation, and management, etc. Even if you have no knowledge of Web3, you can easily start an NFT project, making it ideal for companies with the above issues and needs to start an NFT project.
SBINFT Mits also supports measures to develop and acquire KOLs (Key Opinion Leaders) for a company’s products. The service is unique in that it allows companies to use NFT to reward opinion leaders, while creating their own new opinion leaders and loyal users in a cyclical manner.
BCN: Most NFT marketplaces are primarily focused on enabling artists to mint, sell, and re-sell their NFT artworks. However, your platform claims to be focused on practical NFTs such as game characters and tickets. What was your thought process behind doubling down on in-game characters and other practical NFTs?
JK: SBINFT released the NFT Marketplace in 2021 with 100 approved artists. Currently, we have about 200 approved artists working with us. However, looking at the Japanese market, the NFT marketplace with its emphasis on NFT artwork has not expanded. This is because traders do not properly recognize the value of NFT artwork.
However, as for NFTs themselves, the practical use of NFTs is becoming more widely recognized. In particular, the utility of NFT is attracting attention in the fields of tickets, characters, and games, and major Japanese game makers and ticketing companies are entering the market one after another.
We would like to first team up with major Japanese operators to raise public awareness of NFT by producing examples of NFT with utility, and in the future, we would like to spread examples of artwork and other uses of NFT to participants in the trade.
BCN: In the last couple of years, the NFT marketplaces are said to have made progress in preventing piracy of digital assets and checking for scam projects. In your opinion, how big is the problem of piracy and NFT scams, and what initiatives has SBINFT taken to protect the community?
JK: In the years since 2020, piracy and fraudulent projects have been rampant, and with the creation of numerous services that allow anyone to freely issue NFTs, regardless of the IP holder’s rights, a marketplace rife with piracy and fraudulent projects was created as it could.
Recently, the distribution of pirated NFTs has decreased but has not yet been completely eliminated. Also, technological measures to stop it have not yet been found. This situation is not good for major IP holders.
We started operating as a marketplace with only authorized artists/projects from the beginning of our release in 2021 in order to firmly address the issues related to the distribution of pirated NFTs.
Do you agree with SBINFT’s approach to tackling NFT piracy? Let us know what you think in the comments section below.