Japan’s manga, anime and gaming businesses have a global audience—but reaching overseas customers can mean running into payment restrictions and costly gaps in existing payment rails.
Japan Bitcoin Industry Inc. has raised ¥800 million to build aurora, a Bitcoin-powered payments product aimed at helping Japanese platforms serve customers worldwide.
Director Kishin Kato discusses the company’s strategy, the case for Lightning payments, and why it sees cross-border commerce as a major opportunity.
Interview Q&A: (note: the product name aurora is intentionally lower-case)
Q. What exactly does Japan Bitcoin Industry Inc. do?
A. We are Japan’s leading Bitcoin specialist company, with a mission to spread awareness and integrate Bitcoin into the Japanese economy in ways that solve real problems for both individuals and companies. Currently, our business portfolio includes aurora, our flagship payments product, slated to launch next year; UseBitcoin, a Japan-focused, privacy-first gift card store that accepts payments over Lightning; Bitcoin Research JP, Japan’s premier Bitcoin-only technical publication launched in 2015; and Yap Island, a Bitcoin education app that rewards people new to the space with real bitcoin, allowing them to gain both knowledge and experience in a cute, fun quiz format.
Q. What problem does Japan Bitcoin Industry Inc. solve, and why does it matter now more than ever?
A. Our flagship product aurora is currently aimed at the Japanese creative content industry: think manga, anime, games, and so on. Most of the existing platforms that serve this type of content have faced censorship from international card payment networks, especially in the last several years, essentially resulting in one of two outcomes — give up on accepting international payments altogether, or strictly censor the content on the website to meet the demands made by credit card networks. While we oppose censorship in general, oftentimes, the censorship is far too broad-stroked, banning content that could hardly be considered harmful. Considering Japan’s content industry is both a source of international income as well as a cultural cornerstone, we find it crucial that Japanese content creators are able to sell their digital products globally without issue.
Q. Walk us through Japan Bitcoin Industry Inc.’s product – what makes it unique in the market?
A. Despite the Japanese Bitcoin scene playing a central role in the early days, adoption has lagged significantly since 2018 when compared to the rest of the world. One example is the lack of Lightning Network support by any of the local exchanges, which has resulted in extremely low awareness of Bitcoin’s viability as a payments network. On the other hand, we look abroad and see payment processors like Square, wallets like CashApp, and exchanges like Binance supporting Lightning payments, which in conjunction have created an open payment network which hundreds of millions of users already have access to.
JBI is unique in the Japanese market, as 100% of our members consider themselves Bitcoin enthusiasts, we employ many developers with Lightning Network experience, and can present a strong value proposition for the target market. In the long run, it is Bitcoin’s censorship resistance, and our understanding of it, that gives us confidence in our product — something most entrepreneurs in Japan have yet to understand.
Q. What does Japan Bitcoin Industry Inc.’s ideal customer look like, and how do you reach them?
A. At first, we are looking at platforms and payment service providers that desperately need international payment rails to be able to accept overseas customers. These are companies who may be able to 2x, 5x their total accessible market if they are able to serve internationally. Not only do we initiate contact with such companies, but the public discourse is also something that we are actively trying to use to garner interest. In the long run, individual creators will also be an important customer base, as they may seek to be independent of platforms to reduce deplatforming risk.
Q. How does Japan Bitcoin Industry Inc. handle custom integration requests from large clients?
A. Our aurora product is purposefully simple, and we do not plan to accept much customization — the integration experience is no different from the many common payment options available today. A very simple API, an exchange account, and our clients will be able to receive their revenue converted to JPY in their bank account every day.
Q. Where do you see Japan Bitcoin Industry Inc.’s market heading in the next 3-5 years?
A. Not only is international payment processing becoming more and more cumbersome, but we also see that Bitcoin integration is gradually spreading, and at some point we believe a powerful network effect will start to drive the flywheel. CashApp users, for example, being able to pay at any merchant accepting Lightning payments is extremely underrated; no longer do merchants need to apply to individual payment processors or middlemen; they can simply use Bitcoin. Additionally, in a future iteration of aurora, we will also support sending payments, opening up a whole new market of pay-your-user business models as well as Japanese payment processors following in CashApp’s footsteps.
Q. How does Japan Bitcoin Industry Inc. differentiate from competitors, and what’s your moat?
A. The Japanese business scene, and the legal & regulatory challenges surrounding Bitcoin, exchanges, and payment processing are both complex and time-consuming to navigate. We have fortunately been able to cultivate the necessary relationships over the past 2 years, as well as operate services that both accept and make payments, providing us with a first-class testing ground for the product we are building. Although the open nature of Bitcoin will eventually bring us competition, we believe that our strong relationships and reputation are a significant moat. Not to mention our company name!
Q. Japan seems to be very interested in stablecoins. What is Japan Bitcoin Industry Inc.’s take on them?
A. While stablecoins, particularly US Dollar stablecoins, on specific chains, may have significant traction, the Japanese business scene seems interested in JPY stablecoins, which would not be a good fit for international payments in our opinion. Bitcoin’s deep liquidity, censorship resistance, and Lightning Network privacy are all amazing properties to have for online content purchases, and nonetheless we are well positioned to accept various stablecoins via Bitcoin, if and where demand proves to be significant.
Q. Where do you see Japan Bitcoin Industry Inc. in 5 years?
A. We expect the next 5 years of Bitcoin adoption in Japan to mainly be within the online, international payments context. In that regard, while we may not be a prominent Japanese household name in 5 years, we will hopefully be able to connect the world to the majority of the Japanese content market though Bitcoin, and prevent payment network censorship from suppressing creativity in one of the best Freedom of Expression countries in the world, Japan.
About
Name: Kishin Kato
Role: Director
Company: Japan Bitcoin Industry Inc.
Company URL: https://jbi.co.jp
Company X Handle: @JBIinc_bitcoin
Kishin Kato’s X Handle: @btc_dakara
