Introduction of
KPMG Japan’s
Web 3.0 Promotion
Support Division

March 2023

Overview of Web 3.0
Major components of Web 3.0
Web 3.0 does not have an established definition. However,
it is generally considered to mean the foundation that
supports economic and social activities by providing thefunctions of transferring and exchanging financial value
and information by means of public blockchains and smart
contracts.

Major components of Web 3.0

ExamplesMajor use cases

Aave, Compound, Uniswap

Lending, decentralized exchanges(DEXs), Protocol DAOs

Crypto-assets

BTC, ETH, SOL, MATIC

Financing, payment tokens

Security tokens

EIB bonds, INX Limited

Financing

USDT, DAIStandby funds at exchanges, use for
DeFi

Nishikigoi NFT, LAND

Financing, products, unique items

DeFi
DAOs

Tokens/Digit
al assets

The major components of Web 3.0 are considered toinclude public blockchains and tokens based thereon, as
well as decentralized finance (DeFi) and decentralized
autonomous organizations (DAOs) that use smart
contracts, as described below.

Stablecoins
Non-fungible tokens(NFTs)

Bitcoin, Ethereum, Solana, Polygon

Public blockchains

Generating new economic zones and b usiness opportunities
In addition, new products and services are continuously
created by taking advantage of inexpensive costs related
to transfer and exchange (including issue, segmentationand cross-border transactions) of financial value (tokens).
Because of this, businesses using Web 3.0 and its market
are rapidly expanding.

Web 3.0 offers functions that serve as the foundation to
support economic and social activities, such as transfer
and exchange of financial value. These functions areprovided by an architecture different from the existing
frameworks, and therefore are generating new economic
zones different from those based on the existing
frameworks.

Economic and social activities

Use ofWeb
3.0

Increasing
business
opportunities

Shift ofactivities

Precedents of economic activities:
GameFi, Web 3.0-type metaverse, Fan
TokensPrecedents of social activities:
Regional revitalization using NFTs/DAOs
Infrastructures using Web 3.0:
Wallets, custody service
Provision ofvalue
transferfunctions

Economic and social activities

Provision ofvalue
transferfunctions

Commissions(P2P transactions)/DeFi and DAOs
Foundati
on of
Web 3.0

Tokens: Crypto-assets, security
tokens,stablecoins, NFTs, etc.

Differentarchitecture

Public blockchains

Commissions

Banks

Securities
companies

Foreign exchangetransactions

Market and over-thecounter transactions

Deposits

Securities

Fund settlement
systemSecurities
settlement system(Some ofthe)existing
frameworks

2© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

Use and issues of Web 3.0 in businessFeatures and characteristicsof Web 3 .0
Web 3.0 and the existing frameworks
are the same in that they provide thefunctions of transferring andexchanging financial value. However,Web 3.0 has the features described in
the table on the right-hand side, and it
is considered that these features are
first used in business as use cases.
In addition to transfer and exchangeof financial value, DAOs allow token
holders to participate in governancethrough the framework of decisionmaking by voting. DAOs have effects
such as strengthening communities,
leading to a wide range ofapplications.

Characteristics of Web 3.0 compared to theexisting frameworks

Features of Web 3.0

Transfer and exchangeof financial value
without an intermediary

Inexpensive costs ofissue, segmentation,transfer and exchangeof tokens

Cross-bordertransactions

Issues in using Web 3 .0
Amid the shift of economic and social
activities, it is inevitable for many
companies to adopt Web 3.0.
However, in using Web 3.0, which is a
new architecture different from theexisting frameworks, attention shouldbe paid to different points regarding
strategy formulation and businesspromotion as described in the tableon the right-hand side, and therefore
companies need relevant specialized
knowledge and skills in many
situations.

1.

Design anddevelopment of abusiness model

2.

Establishment ofbusinessstrategies

4.

Reducing costs in the value chains and accelerating
the transfer and exchange of financial value due to nobrokerage fees•

Distributing products and services that had not been
distributed previously due to no intermediaries who
select products and services (however, this may also
increase the number of illicit and defective products)•

Facilitating the issue of tokens even with a small
amount of financial value, increasing the number ofissuers (such as small- and middle-sized companies,
individuals, non-profit organizations andcommunities) and making more diversified assets
tokens•Enabling the purchase of and investment in a small
amount of tokens due to the inexpensive costs ofsegmentation, transfer and exchange of financial
value, and expanding the purchase of and investment
in tokens to the mass retail segment•

Globally expanding the distribution of products andservices, as well as the participation by purchasers
and investors, mentioned above, and enhancing theeffects expected from the above characteristics

Examples of issues arising from differences withexisting frameworks

Area

3.

•

Establishment of abusiness
promotionframework

Collaboration withexternal business
operators•

Adoption to the shift of customer touch points fromaccounts to wallets•

Change in business models due to direct connection
with customers without intermediaries•

Change in business, such as transactions with DAOs
and use of DeFi•

Formulation of business strategies based on appliedlaws, regulations, and accounting and tax systems•

Evaluation of the blockchain wallet linked to acompany's system•

Establishment of a framework to comply with applied
laws and regulations•

Safe management of customer tokens and response to
the leakage risk•

Change in required personnel•

Collaboration with business operators in the sectors
related to Web 3.0 that have a size, corporate culture
and experience different from those of conventional
companies

3© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

KPMG Japan’s Web 3.0 Promotion Support Division
The establishment of KPMG Japan’s Web 3.0 Promotion Support Divisionthat supports clients in using and promoting Web 3.0
To meet clients’ increasing needs related to the use of Web 3.0 based on blockchains and smart contracts, KPMG
Japan has established the Web 3.0 Promotion Support Division by expanding the scope of the former Fintech
Innovation Division to Web 3.0.
Web 3.0 Promotion Support Division• Support in establishing a framework to comply withlaws and regulations on Web 3.0• Accounting and tax advice for business using
blockchain technologies

Date ofestablishment

September 1, 2022
Division head: Kenji Hoki (KPMG AZSA LLC)

Key
members

Deputy division head: Tatsuji Fujii (KPMG Consulting
Co., Ltd.)
Core member: Tomokazu Sekiguchi (KPMG AZSA LLC)
Core member: Naoto Watanabe (KPMG Tax
Corporation)

KPMG FAS*Services related to Fintech continue to be provided.

KPMG Tax Corporation

Web 3.0 Promotion
Support Division

KPMG AZSA LLC

Examplesof newmajor
services

The members of therespective entities thatprovide Web 3.0-related
advisory horizontally
cooperate with each otherin:

KPMG Japan• Support related to Web 3.0

KPMG Consulting Co., Ltd.

Name

Number of
personnel Approximately 80 people• Sharing knowledge;• Participating inindustrial groups;• Making proposals toclients;• Providing advisory;• Providing seminars andinformation;• Taking initiatives inrespective industries;
and• Cooperating withoverseas KPMG
member firms.

Sup porting the promotion of activities to use Web 3 .0 for companies’ business
For issues that our clients may face when using Web 3.0 for their business, KPMG offers one-stop support in obtaining
specialized knowledge required in each of the following phases:
1. Understanding

2. Strategy formulation

3. Establishment of aframework

4. Business operation

Planning and development
Regulatory compliance
Security
Accounting and tax systems
Business collaboration

Knowledge required in each p hase1.

2.

Understanding of Web 3.0: Knowledge in characteristics
that should be incorporated in a business related to the newarchitecture, Web 3.0 and matters that should be noted whenusing Web 3.0 (such as leakage risk), as well as knowledge inlaws, regulations, and accounting and tax systems, which isindispensable to formulate business strategies
Formulation of business strategies: Knowledge in (1) theunderstanding of Web 3.0; (2) the formulation of businessstrategies and the definition of system requirements based on
the impact on existing businesses as well as the management
policies; and (3) the establishment of a network that contributes
to the procurement of necessary resources (including
collaboration with external business operators)

3.

4.

Establishment of a promotion framework: Knowledge in(1) the establishment of a framework necessary to comply
with regulations based on strategies; (2) the establishment of
security measures; and (3) business cooperation and otherexecutions
Business operation: Knowledge in (1) the sophistication ofa management framework to address issues that occur after
the beginning of operation; (2) response to changes inregulations; and (3) security sophistication

The major services provided by the entities belonging to KPMG Japan’s Web 3.0 Promotion Support Division are
described in the next slides.
4© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

Advisory service provided by KPMG Japan’s Web 3.0
Promotion Support Division
Service namePlanning anddevelopment
supportRegulatorycompliancesupportSecurity
response
support01

Web 3.0 business creation
sessionSupport on the creation of new business ideas
using Web 3.0 and relevant planning by leveraging
our expertise in new business development,
strategy formulation, laws and regulations, as wellas accounting and tax

02

DAO organization andmanagement support

Consistent support on the formulation,
development, and sophistication of businessstrategies using a DAO

P.7

03

Support on regional
revitalization using Web 3.0

Support on the promotion of regional revitalization
projects based on our wealth of knowledge in Web
3.0, including tokens (such as NFTs) and DAOs, aswell as regional revitalization

P.8

04

Support on the license application for crypto-asset
License application support for
exchange business based on our extensive
crypto-asset exchange
knowledge in the Payment Services Act,
businessgovernment orders and administrative guidelines

P.9

05

Support on establishment ofrisk management framework
related to ownership of digitalassetsSupport on the establishment of a risk
management framework for companies owing
digital assets based on our high level of knowledgein public blockchains

P.10

06

Response to fraud andmisconductSupport on the diagnosis and sophistication of amanagement framework for bribery risk, thirdparty risk and fraud risk, as well as on fraud
investigation and recurrence prevention

P.11

07

Blockchain foundation
evaluation service

Evaluation of the risks and measures for thesystem that serves as the foundation of the Web
3.0 service, and support on the development of
improvement measures

P.12

08

Threat scenario analysis andcountermeasure development
service

Evaluation of the effectiveness of countermeasuresand a response framework for threat scenarios
developed by cyber specialists, and support on thedevelopment of improvement measures

P.13

09

Threat intelligence service

Analysis and evaluation of data from information
sources including the dark web, report of threats
and support in taking down threats

P.14

10

Support for businessestablishment and synergy
creation(CDD, BDD and PMI)

Support on market analysis, businessestablishment, technical analysis, business plandevelopment and post-investment synergy
creation for businesses related to crypto-assets,tokens and NFTs

P.15

11

Advisory on M&A projects

Financial advisory and various types of due
diligence on sourcing and project management, as
well as valuation inside and outside projects

P.16

12

Consultation on accounting
and tax issues arising fromusing digital assets

Advisory on complex accounting and tax issues
related to digital assets, including crypto-assets, incooperation with accounting and tax specialists

P.17

Businesscollaboration
supportAccounting andtax support

Overview

P.6

5© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

01 Web 3.0 business creation session
Web 3.0 is attracting attention as it creates new services and businesses, and many startups using its
technologies have emerged. In the area of Web 3.0, there are various matters that should be considered,including the understanding of market trends and response to laws, regulations and tax systems.
KPMG provides support on the creation of new business ideas and relevant planning while leveraging thespecialized knowledge we have acquired through new business development and strategy formulation
support and regulatory response, as well as accounting and tax practices.
We assist the development of an optimal roadmap by first layering the Web 3.0 components and thenclarifying considerations, including business strategy formulation based on market trends, response to laws,
regulations and guidelines, and the identification and understanding of core technologies (such as
blockchain technologies).
Web 3 .0 business creation session
Clarification of the whole
picture of Web 3.0

We clarify the whole picture of Web 3.0 by identifying market
trends, technology structures, and laws, regulations and tax
systems that should be addressed.

Web 3.0 business creationand planningWe support the creation of new business ideas and relevant
planning in the Web 3.0 area based on each organization’senvironment.

We want to know about market
trends and cases in the Web 3.0
area inside and outside Japan.

We want to consider investingin and collaborating with Web
3.0 startups.

We want to clarify laws,
regulations, tax systems andguidelines that we should
address.

We want to develop a new
business (using blockchains,
DAOs, and tokens).

Examples of approaches to Web 3.0 business creation
Web 3.0 components

Clarification of considerations

Layer 5: Strategy andgovernanceBusiness strategy andgovernance formulation

Strategy

Governance Business strategy
formulation
 Market trend analysis

 Response to laws,
regulations and tax
systems

Layer 4: User interface
Tools and services used by users
to access Web 3.0

 Improvement of user interface (UI) and user
experience (UX) Prevention of operational errors and security functions

User interface

Application

Layer 3: Applications
Applications and services
established in the platform Differentiation from similar content services
 Product development leveraging basic
technologies

Layer 2: Development
Development language andlibrary used when an application
is established Flexibility and scalability in development
 Possibility of procuring development andoperational technicians

Layer 1: Platform
Basic technology (platform) todevelop applications and services Whole picture of the ecosystem and technological
specifications
 Framework of on-chain governance

Development

Platform

Roadmap formulation
Phase 1. Businessconsideration
 Understanding the strengths andresources of a subject company
 Market trend analysis
 Business strategy formulation

Phase 2. Business design andestablishment
 Response to applied laws and regulations
 Establishment of an organizational
structure and governance formulation
 Investigation and selection of basic
technologies
Phase 3. Proof of concept (PoC)and business development
 PoC and initial verification
 Business development based on PoC
verification results
 Operational evaluation and improvement
after business development

6© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

02 DAO organization and management support
There has been an interest in businesses using digital assets (such as crypto-assets and NFTs) andDAOs inside and outside Japan.
KPMG provides one-stop support in various industries on the formulation, development andsophistication of business strategies using a DAO while leveraging the specialized knowledge wehave acquired through new business development and strategy formulation support andregulatory response, as well as accounting and tax practices.
Matters that should b e considered in ab usiness using a DAO

MarkettrendsTo effectively promote a business using a DAO, it is important tounderstand dramatically changing market trends (including
crypto-assets) and formulate appropriate business strategies. It isalso indispensable to respond to applied laws and regulations andunderstand core technologies, such as blockchains and digitalassets (crypto-assets and NFTs).

Business risk
andgovernanceSup port by KPMG
KPMG provides one-stop support on the formation, development
and sophistication of business strategies by using our specialized
knowledge in regulatory response and accounting and tax affairs,
as well as our wide network and extensive support experience inthe technology area, including blockchains.

Business strategy
and governance area

Technology area

Accounting andtax affairs

Busi nessstrategy
form ulation

Reg ulatory
resp onse

Applied laws
and regulations

Und erstanding ofcore technologies

Smart contracts

Blockchains

B usiness strategy
formulation

Market trend study

Organizational structuredevelopment

Response to accounting
and tax affairs

Regulatory response

Governance formulation

B asic technology study
and evaluation

Requirement definitionand design

PoC and businessdevelopment

Business development roadmap
Phase 1. Businessconsideration◆ Individual session for businessconsideration
Together with specialists, we provide
companies that are considering the DAO
business with sessions to meet their wish todeliberate a specific method and feasibility ofthe business.

◆ Support on new business plan
formulation

We support the formulation of a new businessplan and an entire roadmap, including studiesof the latest trends of Web 3.0 andconsiderations of regulatory response.

Phase 2. Business designand establishment◆ Sup p ort on reg ulatory response andg overnance formulation
Our specialists in accounting, tax and relevantlaws and regulations provide support inestablishing guidelines and formulating abusiness plan.
◆ Stud i es of b asic technologies and support
on technology selection
We support the selection of technologies best
suited for a business through studies, using theknowledge of Web 3 .0 specialists and our
global network.
Market trend
andtechnology
studies

Laws andAccounting
reg ul ations
and tax
New b usiness considerationand p l anning

Technol ogy

Market trend s

Technology
selection
supportOperational
evaluation

Phase 3. PoC andbusiness development◆ PoC, op erational evaluation andi m provement support
We provide one-stop support, ranging frompre-operational PoC to business development,
operational evaluation and improvement topromote the sophistication of the businessusing a DAO.

PoC
Initial verification
Development
Operational
evaluation

Improvement7© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

03 Support on regional revitalization using Web 3.0
There has been an increasing interest in regional revitalization using Web 3.0 (including NFTs and DAOs).
As the Japanese population is decreasing and the measures to promote settlement and the start ofbusinesses in a region are at their limits, regional revitalization initiatives have been expanded. These
initiatives include efforts to increase the number of digital residents and create business opportunities
through financing by means of NFTs and DAOs, as well as community revitalization.
Using our wide network and wealth of knowledge in Web 3.0 (including NFTs and DAOs), KPMG
provides advisory service to support communities aiming for regional revitalization based on relevantlaws, regulations and guidelines.
For using Web 3 .0 for regional revitalization, it is necessary to understand Web 3 .0 technologies,
laws and regulations
To effectively use Web 3.0 (including NFTs and DAOs) forregional revitalization, it is indispensable to understandnew technologies and features, including blockchains andgovernance tokens, as well as relevant laws andregulations that may be applied.

It is also necessary to establish a risk management
framework incorporating those technologies, laws andregulations, as well as collaboration with external business
operators. KPMG has many specialists in relevant laws andregulations, accounting, tax and regional revitalization
business, as well as a solid network in the Web 3.0 industry.
We are able to provide one-stop support to address various
issues.

If a company does not have specialized knowledge, it isnecessary to actively collaborate with external business
operators having professional skills. However, it is not easy
for a company with a short history in a new industry toreach an appropriate collaborator.

Possibility of application of financial laws and regulations related to tokens and governance tokenization
Among the Web 3.0 components, NFTs subject to a few
regulations are often used. However, larger businesses
need to use tokens subject to more regulations. Attention
should be paid to the fact that governance tokens used for

DAOs may fall under tokens other than NFTs (e.g., security
tokens) depending on the remuneration system.

Major type of tokens

How tokens are regulated in Japan

Governance tokenization

Cypro-assets

Regulated by the Payment Services Act

Possible

Security tokens

Regulated by the Financial Instruments andExchange Act

Possible

Stablecoins

Regulated by the Payment Services Act

Basically not expected

NFTs

Treated as part of the tokens that do not fall under
any of the above

Possible

Examples of support services for regional revitalization using Web 3 .0

01

Identification, understanding
and sophistication of thecurrent situation

02

Response confirmation,planning and promotion
system establishment

03

Implementation and initial
verification

We identify the strengths and thecurrent resource situation byorganizing past activities andachievements. We also promote theunderstanding of Web 3.0, including
NFTs and DAOs, to refine andsophisticate a scheme.
 Organization of past activities andanalysis of the current situation

We confirm the matters to beaddressed based on the scheme,
offer advice on the method of
procuring resources necessary for
project execution and review theestablishment of a project promotion
system and the process chart.
 Confirmation of the policies formatters to be addressed

We verify the results of the preproduction tests, such as
substantiative experiments, basedon the process chart and provide
advice on corrections, as well as
matters selected during the initial
verification after the start of the
project.
 Verification of the results of test trials

 Promotion of the understanding of Review of the resource procurement

 Advice based on the verification

Web 3.0 characteristics
 Refinement and sophistication of aschemeplan
 Review of the project promotion
system and the process chart

results

 Initial verification after the

implementation of measures8© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

application support for crypto-asset
04 License
exchange businessResponding to the expansion of the NFT market and an increase in the number of companies using
NFTs for business purposes, there has been a growing interest in the use of crypto-assets, whichhave a variety of uses, such as larger fundraising and payment methods.
However, unlike NFTs, to conduct crypto-asset exchange business, companies need to file a license
application with the regulatory authorities and establish a strict regulatory compliance framework,
which requires specialized knowledge.
KPMG AZSA LLC provides advisory services that support license applications for crypto-asset
exchange business based on our extensive knowledge in the best practices of related industries inaccordance with the Payment Services Act, government orders and administrative guidelines, aswell as self-regulations.
Review process of a license application by a crypto-asset exchange service provider
A prior consultation with the regulatory authorities is conducted before submitting alicense application. In the prior consultation, a company submits an answer sheet for thequestionnaire publicly available. After it is confirmed that there is no correction to theanswer sheet, the company proceeds to the main process involving interviews with
officers and inspection. Upon completion of the main process, the license application
will be accepted.

*Regarding the reduction of processingtime
To reduce the time required for the license
application review, it is important to shorten the
period before entering the main process.

Licenseapplication

Prior consultation
Submit theanswers tothequestionnaire

Whetherany
correction
is requiredNo

Main process
Interview with
officers/Document review

Onsiteinspection

3 to 4 months

1 to 2 week(s)YesSubmit thelicenseapplication
1 to 2 month(s)• Preparation of corrections andadditional materials (such asattachments and evidence)• Clarification of a business plan

Example of how support service is provided in relation to license application for
crypto-asset exchange business
Based on our rich experience in providing support to crypto-asset exchange service providers (including license
application) and relevant specialized knowledge, KPMG AZSA LLC is able to efficiently assist the establishment of aframework required for a crypto-asset exchange service provider, as described below.

of the01 Understanding
current situationof matters
02 Organization
03
to b e addressed

In addition to confirming the business modeland the profit plan to be rolled out by thecrypto-asset exchange service provider, weunderstand the current regulatorycompliance framework and future personnelplans by conducting interviews andinspecting materials.

We conduct a gap analysis by setting laws
and regulations (including government
orders and supervisory guidelines), as well
as self-regulations as benchmarks, andidentify and organize the issues to beaddressed.
 Gap analysis against the current situation

Confirmation of the crypto-asset
exchange business to be rolled outIdentification and confirmation of gap
items



Understanding of the current regulatorycompliance framework

Formulation of measures to close thegaps

Establishment offrameworks

For identified matters that should be
addressed, we provide license
application support by assisting the
preparation of internal regulations,advising the establishment of aregulatory compliance framework(including internal management) andreviewing license application documents.


Review of license application documents

Support on the preparation of relevant
regulations



Advice on the establishment of aregulatory compliance framework9© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

05 Support on establishment of risk management

framework related to ownership of digital assets

With the advancement of Web 3.0 based on public blockchains, more and more financial
institutions consider conducting businesses that utilize tokens on blockchains (such as NFTs andcrypto-assets) and DAOs, as well as experimentally acquiring crypto-assets and tokens by using
their private funds.
However, financial institutions are subject to the stringent regulations, stipulating that theacquisition of crypto-assets shall be limited to the minimum extent. In addition, for the safe
management of tokens on public blockchains, it is necessary to acquire a high level of knowledge
and establish an internal management framework since there is a high leakage risk in the
management of such tokens in a wallet.
KPMG AZSA LLC offers advisory services on the establishment of an internal management
framework to financial institutions that acquire and manage tokens, including crypto-assets.
New needs for financial services and matters to be addressed
Consideration of
acquisition of
crypto-assets

Consideration ofprovision offinancial services

Compliance withstringent regulations

Web 3.0

Users’ interest
in tokens

Non-financial
companies’
entrance to token
business

Specialized knowledge inmeasures againstleakage risk

Stringent regulations on the ownership of crypto-assets and our support
In acquiring crypto-assets, a financial institution needs to comply
with supervisory guidelines that limit the ownership of cryptoassets to the necessary extent and other stringent regulations
that require the implementation of safety management measuresagainst leakage risk.

Based on our wealth of knowledge and experience in handling
crypto-assets, KPMG AZSA LLC provides the following support
on the establishment of a framework to comply with applied laws
and regulations:

Examples of general steps in our support to establish an internal management framework forcryp to-assets and tokens (3 to 5 months)
Understanding thesituation
01 currentof mattersto b e addressed
02 Organization
03

In addition to confirming the assumed
business model related to tokens andlaws and regulations that may be
applied, we understand the current
internal management framework byconducting interviews and inspecting
documents.

We perform a comparative and gap
analysis against the current situation by
setting laws and regulations applied tofinancial institutions and supervisory
guidelines as benchmarks, identify
matters to be addressed and confirm
the policy for such matters.
 Gap analysis against the current situation

 Drafting Identification

 Advice on the establishment

 Confirmationof the details of the token

business
 Confirmationof applied laws andregulations*and confirmation of gap

items Confirmation

Establishment offrameworks

Using our specialized knowledge, we
provide advice on the establishment ofdraft internal regulations and aninternal management framework inaccordance with the response policy
and support the establishment of othernecessary frameworks.
of relevant regulationsof an internalmanagement frameworkof the policy for gap items

 Understandingof the current internalmanagement framework10© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

06 Response to fraud and misconduct
When a bribery risk, third-party risk or any other fraud or misconduct risk materializes, acompany’s business will be affected significantly. For example, the company may bear an
unexpected burden of the investigation to confirm facts and necessary response, or may besubject to instructions, a fine or a disciplinary action imposed by the authorities. In other cases, thecompany’s reputation may be damaged, or its profitability and share prices may decrease. Basedon our rich experience and knowledge in risk management, KPMG provides support related to themeasures to prevent the above risks from materializing and subsequent responses, as described
below.
Risk assessment

Testing and monitoring support

Risk assessment is an important activity that serves as the basis
for efficient and effective response (risk-based approach), making
the most of limited economic and personnel resources. The
method of organizing and assessing risks differs depending on
the risk area and purpose. We provide the following support bytaking into account the relevant laws, regulations, guidance, thebusiness details and plans, and the external environment, as wellas industrial practices:

In any risk management activity, it is important to regularly
confirm whether the controls introduced are appropriately
operated and effective. It is also important to continuously
implement a plan-do-check-act (PDCA) cycle for necessary
sophistication by monitoring potential risks. KPMG provides thefollowing support related to activities to monitor operations incompliance (second line of defense) and internal audit (third lineof defense): Consideration and design of a risk assessment method Implementation of a risk assessment (reduction of risks andpreparation of a heat map of risks and a risk assessment
report) Subsequent review of risk assessment results (review of risk
assessment results and response to sophistication)






Diagnosis of the current risk management
framework and gap analysis

Fraud and misconduct investigation

Design and introduction of a testing system
Formulation of testing procedures and manuals
Testing
Formulation of improvement measures based on testing
results
 Review of the testing system

In recent years, society has cast a stern eye toward thesubsequent responses of companies that have committed fraud
or misconduct. If any fraud or misconduct occurs, companies
are required to minimize the damage, thoroughly clarify facts,and formulate and implement appropriate measures to prevent
recurrence. Accordingly, KPMG provides support related to thefollowing:

For subject risk themes, we determine the target level(benchmark) of the company based on laws, regulations andguidelines of other countries, as well as precedents in therelevant industries. We then analyze the current organizationalframeworks, including controls.
We prepare an effective action plan for the identified gaps basedon the viewpoints to be considered, characteristics of immediaterisks and available management resources, as well as precedingpractices.

 Formulation of an audit system and an audit plan Dispatch of investigation committee members
 Maintenance and recovery of evidence, such as electronicdata Investigations (e.g., inspection and analysis of transaction
data, relevant documents and emails, site investigation toconfirm inventories, and interviews with relevant personnel)
 Estimation of the amount of damage and impact
 Formulation, operation and monitoring of measures toprevent recurrence Preparation of an investigation report
 Reporting to authorities, press release and response tolawsuits

Support for designing and introducing controls
We provide support in designing and introducing a system ofcontrols to address (prevent, discover and resolve) risks andreviewing existing controls based on laws, regulations andguidelines of other countries, as well as precedents in therelevant industries.

11© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

07 Blockchain foundation evaluation service
Systems using blockchains adopt technologies that were not used for previous systems, such as
peer-to-peer (P2P) networks and distributed ledgers. Therefore, there are various distinctive risks
related to technical elements. When establishing a system, it is necessary to understand andidentify system risks unique to blockchain technologies and implement countermeasures.
KPMG objectively evaluates the entire ecosystem that adopts a blockchain or the information
system of the blockchain foundation supporting the ecosystem from a third-party perspective.
Moreover, we provide support in maximizing the effect of using a blockchain as expected bycompanies, by performing an evaluation suitable for the purpose and the situation.
Examples of risks and measures related the use of a b lockchain
Technical elements and risk examples

Technical measures

Distributed ledger(1) Discrepancy inledgers due to a
network partition(2) Decrease in theprocessing ability due
to insufficient blockvolume(3) Risk arising fromtransaction data
corrections(4) Leakage and loss ofprivate keys

 Establishing a

 Designing the size of Formulating a Technical measures forframework for a nondisruptive network (amultilayer network,
redundant devices andvirtualized
environment) Enabling a failure test

Chain data structure

Concealment oftransactions

P2P network

the domain storingtransaction data within
the block Verifying the projectedtransaction data backup
plan Establishing proceduresfor storing backup data

increase in volume
against the domain size

layered defense Technical measures forprivate key
management

for the risk

Operational
measures Establishing a

 Establishing a

 Establishing a

 Preparing a recovery

 Establishing Preparing a recovery

framework to detect
failuresplan and procedures inthe event of a failure

framework to monitor
the block size
operational rules fordomain extension

framework to detect
failures Establishing

operational rules forprivate key
management

plan and procedures inthe event of a failure Recovery training Recovery training

Evaluation approach

We set risk scenarios considering the characteristics of the subject system, perform an
evaluation and propose improvements.

1. Understand thesystem

2. Set risk
scenarios

3. Evaluate themeasures4. Propose
improvements

Outcomes Clarification of the action plan to reduce risks of the system that adopts a blockchain
 Establishment of a process of evaluating and managing the system that adopts a
blockchain
 Integration of the existing system with the risk assessment standards and the evaluation
process, as well as the sophistication of the existing system*We also provide optional vulnerability tests and penetration tests for technical evaluation.
12© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

scenario analysis and countermeasure
08 Threatdevelopment service
The technologies of services using blockchains reduce privacy and cyberattack risks. However,there still remains the risk that the blockchain architecture, the cloud of the service foundation ormobile applications are exposed to attacks.
KPMG provides support to ensure service security by formulating threat scenarios from anattacker’s viewpoint, verifying the feasibility of the scenarios and developing measures.
Setting threat scenarios
We analyze cyberattack threats that may cause damage (risk) on business andoperations by using threat intelligence and develop cyberattack procedures torealize the threat scenarios from a professional perspective.
Determination of an attack
targetWe analyze the damage (risk) on
business and operations that may
be caused by a cyberattack anddetermine an attack target.
••••

Theft of client information
Theft of important andconfidential information
Destruction of importantsystems
Complicity in attacks

Threat intelligence
We collect potential threat
information on the surface web.
*As options, we provide extensive
research, ranging from theinternet (high layer) to the dark
web (deep layer), which iscommercialized by criminals, andassessment of potential impact byusing our OSINT tools (e.g., KPMG
Digital Insight Platform).

Formulation of threat
scenarios and attack
procedures
We develop threat scenarios andattack procedures to achieve theattack target based on theconcepts of Cyber Kill Chain® and
MITRE ATT&CK®.

Verification of the feasibility of threat scenarios
In cooperation with KPMG’s global network, our experienced white-hat hackers
set threat scenarios considering the characteristics of the services subject tothe assessment, evaluate the network system configuration and propose
improvements. They also perform a penetration test, as needed, to verify thetechnical feasibility of security measures against threat scenarios.
Examples of characteristics of services using blockchains
Difficulty in security updates

 It is difficult to control security updates on the users’ side.

Complex ecosystem There are a wide variety of components, such ascommunications, networks, interfaces and users.

Various attack routes

 Blockchains are used in various services and systems, and there
are various attack routes and methods.

Development in infrastructure Services using blockchains are part of the social infrastructurethat require high availability.
*Company and trade names in this slide may be trademarks or registeredtrademarks of the respective companies.

13© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

09 Threat intelligence service
As cyber threats have become more complex in recent years, organizations increasingly takemeasures against cyberattacks. Organizations have also started to recognize the risk of branddamage arising from the misuse of their websites and information on the internet (hereinafter“cyber brand risk”). KPMG provides companies with advice on the prevention of such risk through“threat intelligence,” which is the activity of collecting and analyzing threat information that could
lead to cyber brand risk. We also provide support to address the risk that has materialized.
Issues surrounding cyber brand risk
Organizations can respond to the so-called cyber security risk, such as malware
infections and targeted attacks. However, it is difficult for them to identify andaddress cyber brand risk through their Security Operation Center (SOC) or
Computer Security Incident Response Team (CSIRT).
Cyber risksCybersecurity risk

Mal warei nfections

Attacks
exp loiting
vul nerabilities

DDoS attacks

Targ etedattacks

Org anizations canad d ress these ri sks

Cyberbrand risk

Account
p urchase andsal eFraud ulent
p arti cipation i n a
com m unity

Circulation of false
information insideand outside a
community

Mi suse andd i sclosure of
vul nerabilities

Org anizations haved i ffi culty i n
ad d ressing these ri sks

Sup port in monitoring and addressing cyb er brand risk
We promptly report threats that could lead to cyber brandrisk by analyzing and assessing data collected fromvarious information sources (including the dark web) bymeans of the analytical engine independently developed
by KPMG. We also provide support to take down thedetected threat sources that may have cyber brand risk.
Analysis of cyber web
information
 Similar or fake applications
 Malicious domains
 Phishing threats

Data sources can be
added.
Soci al media,b l ogs, researcheng i nes,
the d ark web, etc.

Dark web scan

Text mining uses the keyword
database independently developed
by KPMG based on its industrial
knowledge. Text mining can identify
images and analyze sentiment.

 Dark web scrapping Sensitive information
 Executives’ personal

information
Threat information
 Fake relationship with acompany Breached accounts
 Leaked email addresses

Reporting Threats are reported at

a selected timing (e.g.,
daily, weekly, ormonthly).
 Urgent threats arereported via email ona real-time basis.

Brand infringement

Web s,
ap p lication
stores, etc.

 Fake relationship with acompany

Preparing reportdetails based on
various models (aunique model canbe established)

Visualizing risks
with a customized
business
intelligence (BI)tool or report Text, code and IP

infringement
 Logo infringement

Digital reputation
 Social media analysis
 Brand evaluation
 Customer analysis
 Reviewer identification

Misuse of social media

Support for
threat measures
 Advice on threatmeasures is provided
by KPMG’s cyber andsocial media specialists.
 Support is provided totake down threats incooperation with a
specialized vendor.

 Fake accounts
 Executive impersonation14© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

for business establishment and synergy
10 Support
creation (CDD, BDD and PMI)
In recent years, there have been high expectations for a financial business to act as a “next-generation business,"
especially for the business closely intertwining business-to-customer (B2C) with business-to-business (B2B) due to theaging society and diversified payment methods.
Financial institutions are expected to have business models and operations that are significantly different from those ofgeneral non-financial companies, particularly in the establishment, acquisition and sale of a business, as well as theestablishment of a joint venture. KPMG provides one-stop service not only for purely financial business, but also
diversified business areas, such as various payment businesses linked to commercial distributions (including
subscription payments and “Buy Now, Pay Later” (BNPL)), businesses conducted in accordance with the Financial
Instruments and Exchange Act (other than conventional bank and loan businesses) and cryptocurrency business.

M&A strategy (pre-merger)

Post-investment and post-sale strategy support(PMI)

When establishing, acquiring or selling a business, or
establishing a joint venture, a company needs to analyze
potential markets and existing players to understand the target
market. A company also needs to conduct research and organize
strategies in the areas of regulations, practices, profitably,
governance and operation, as well as promotion. Accordingly,
we provide support for clients’ decision-making including thefollowing: Market and regulation research (in Japan and overseas) Benchmark analysis (business models and operations) Definition of a target business model and reasons for
obstacles Deal structuring
 Acquisition of various approvals
 Preparation of an initial business plan

For acquisition, investment and sale of a financial business, it isnever easy to execute a project in accordance with a contract. It
is particularly important to execute an overseas project or a
project involving different businesses in a careful and speedy
manner while negotiating with relevant parties regarding theirrequests and processes related to governance in order to realize
expected synergies.
 Organization of requirements for the governance of affiliates
and subsidiaries
 Organization of integration issues (reporting and decisionmaking systems)
 Process of integration operations
 Integration negotiations
 Consideration of systemization and definition of operational
requirements

Deal due diligence (business due diligence (BDD),
customer due diligence (CDD) and operational due
diligence (ODD))

New business establishment
In recent years, there have been expectations for various
solution businesses incorporating financial business. Attention isparticularly paid to the utilization of commercial distributions
and external data, the streamline of a review process andcollection operations, and the reinforcement of customer
services. Our experienced members provide support for issues
unique to new businesses, including procedures for approval
application and response to authorities, as well as response toerrors after the establishment of a business.

During a project, we support all the matters necessary for thetransaction period, including pilot investigation for the letter ofintent (LOI), negotiation on the terms of the LOI, detailed reviewof the terms before the definitive agreement (DA) is concluded,
and reflection of the terms in the business plan, valuation andcontracts (including the DA).
We cover top-line strategies, sales promotion and channel
strategies, as well as financial services such as credit review,
collection, payment and financing strategies through various
currencies, crypto-assets and other payment instruments.
 Business model study and analysis
 Study of technologies and evaluation of their level
 Operation study and analysis
 Preparation of a synergy plan
 Acquisition of various approvals
 Scenario analysis
 Preparation of a detailed business plan based on the balance
sheet, the profit and loss statement and the cash flow
statement, as well as the business type Consideration and simulation of risk scenarios
 Calculation models for various regulatory values

 Support for approval application with authorities
 Response to the securities business, the payment business,the installment business and the loan business Response to the latest laws on banking business (relaxationof regulations) Consideration of business concepts
 Organization of segregation of duties
 Preparation of the definition of business requirements
 Implementation of governance rules15© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

11 Advisory on M&A projects
Buy-side and sell-side
advisory
services
リード文：Noto
Sansfinancial
R + Univers
for KPMG
55／12pt／行送り16pt／KPMG Blue、段落間ア
キ6pt／文章量が多い場合は、フォントサイズを小さくしてもOK（11pt、行間13.5ptまで）／ダFor buy-side projects, we offer financial advisory services to guide acquisitions and investments to success, fromorigination to closing. For sell-side projects, we deliver services to achieve an effective sale process when a company
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strategically sells a business or exits from the investee.
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Buy-side financial advisory

本文見出し

Sell-side financial advisory

Our major services include:ダミー文章ダミー文章ダミー文章ダミー文章ダミー文章ダ
Support in strategic M&A planningミー文章ダミー文章ダミー文章ダミー文章ダミー文章ダミー
Searching for, screening and approaching target
companies/sellers
文章ダミー文章ダミー文章ダミー文章ダミー文章ダミー文章
ダミー文章ダミー文章ダミー文章ダミー文章ダミー文章ダ
Deal management and advice
ミー文章ダミー文章ダミー文章ダミー文章ダミー文章ダミー
Negotiation support
ダミー文章ダミー文章ダミー文章ダミー文章ダミー文章ダ
Structuring support Due diligence coordination
ミー文章ダミーダミー文章ダミー文章ダミー文章ダミー文章
 Valuation (to be explained later in this document) Matters to be addressed for post-merger integration(PMI)/post-deal business integration

Our major services include:ダミー文章ダミー文章ダミーダミー文章ダミー文章ダミー文
Support in strategic business sale planning章ダミー文章ダミー文章ダミー文章ダミーダミー文章ダミー
Searching for, screening and approaching candidatepurchasers
文章ダミー文章ダミー文章ダミー文章ダミー文章ダミーダ
ミー文章ダミー文章ダミー文章ダミー文章ダミー文章ダミー
Initial consideration of a sales agreement文章ダミーダミー文章ダミー文章ダミー文章ダミー文章ダ
Initial analysis of business value
ミー文章ダミー文章ダミー
Support related to sales scheme considerations
 Deal management and advice
 Due diligence process coordination
 Establishment and operation of a data room and response toquestions Negotiation support
 Support in preparing a sales agreement

Valuation service (for transaction or accounting purposes)
For M&A and restructuring, we support clients’ decision-making by offering various types of valuation from a thirdparty perspective. For post-acquisition accounting, we also provide service to assess tangible and intangible assets
related to purchase price allocation and impairment testing.

Various due diligence service
Pre-M&A due diligence is a valuable opportunity to directly understand the situation of the target company. KPMG
provides strong support on the evaluation of clients’ projects and investment decisions based on our rich experienceand knowledge from a broad perspective.
Financial due diligenceTax due diligence

Financial due diligence involves an investigation of the target company’s
performance and financial position and the understanding of the current
situation mainly related to the following:

For tax due diligence, we investigate potential tax risks that the purchaser
may take over after acquisition by understanding the target company’s
affiliates, related party transactions, past restructuring and non-recurring
profit, as well as tax treatment of these items. In addition, upon a client’s
request, we simultaneously provide structuring advice to select the mostsuitable M&A structure from the purchaser’s tax and economic
perspective.

 Normal profitability eliminating temporary effects on profits andlosses and the consistency of past and latest operating results with
future business plans The level of operating capital required for business management andthe cash flow status Trends of past capital investment, and the future plan and necessity ofcapital investment
 Impairment of significant assets and the status of off-balance andcontingent liabilities
 The status of stand-alone issues
Based on the results of the above investigation, the purchaser canevaluate the project from the following viewpoints and make adecision: Consideration of the appropriateness of the future business plan
proposed by the seller, and the appropriate purchase price based onsuch consideration
 Prerequisites, the indemnification clause and the price adjustment
clause that should be specified in the sales agreement
 Matters to be addressed for PMI/post-deal business integration

Other due diligence
Depending on the necessity for each project, we provide solutions
including due diligence in areas other than the above (investigation of
backgrounds such as IT, human resources, environment, governance,compliance and management).

16© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

12 Consultation on accounting and tax issues arisingfrom using digital assets

The use of digital assets for business has grown recently. However, there is significant uncertainty
about accounting and tax treatment of digital assets since they are a new type of assets. In addition,
new treatments and interpretations of digital assets become available relatively frequently. It isnoted that effectively addressing such a situation is an important challenge for companies to
conduct business making good use of digital assets.
Moreover, since the treatment of digital assets for tax purposes is often different from country tocountry, a scheme using an overseas entity is adopted in many cases.
Accordingly, KPMG AZSA LLC and KPMG Tax Corporation have jointly established a system toprovide advice on a one-stop basis regarding the response to the use of digital assets foraccounting and tax purposes.

Accounting issues

Tax issues• How should crypto-assets be
accounted for?

• The National Tax Agency has
published new FAQs. What
impact do they have?

• Is accounting treatment
different between Japanese
GAAP and IFRS®?

• What impact does the tax
revision in 2023 have?
• When using an overseas
entity, what needs are to beconsidered?

• The types of use of tokens are
increasing. How should
tokens be accounted foraccording to each type ofuse?

• What cases require special
attention?

• What cases require special
attention?

KPMG AZSA LLC

AdviceAccounting and tax issues

KPMG Tax Corporation17© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

Publication and activities of external committees
Publication and activities of external committees
Pu b lication
How will FinTech, cryp tocurrencies and AI change
financial institutions?
(BUSINESS KYOIKUSHUPPANSHA)

Mechanism and p ractices ofdigital currencies andsecurities- Business, law, accounting
and tax(CHUOKEIZAI-SHA
HOLDINGS, INC.)

This book explains the future status offinancial institutions that are compelled
to have a structural shift due toinformation technology advancement,
as well as the direction of financial
business.

This book explains business trends,
legal, accounting and tax affairs
related to digital currencies, securities
and other assets.

B2B Payment Digitalization(Kinyu Zaisei Jigyo
Kenkyukai)• This book explains how companies
should utilize financial electronic
data interchange (EDI) based on theuse of Extensible Markup Language(XML) for money transfer between
companies.

Activities o f extern al co m mittees

KPMG Jap an Fintech Community• QUICK Virtual Currency Benchmark ResearchCommittee: Virtual currency exchange service
providers and specialists in financial instruments,
accounting and laws have discussions to assist thedevelopment of benchmarks supporting virtual
currency activities.

This membership community site aims to promote
open innovation between domestic financial
institutions and Fintech service providers. This
community is joined by more than 90% of domestic
banks, as well as many securities and insurancecompanies. It provides information and network
opportunities through seminars held several times amonth.

• Japan C ryptoasset B usiness As sociation(JC B A)
− Advi s or
− Custody Working Group: For the custody ofvirtual currencies (crypto-assets) in Japan,
this group compiles opinions on theestablishment of a system that keeps abalance between user protection and soundmarket development.

https://fintech.smartcore.jp/− Use Case Working Group: This groupprepares a report to demonstrate theusefulness of crypto-assets in society andconducts activities to create use cases thatlead to regional revitalization initiated by the
JCBA.

Web 3 .0 Promotion Support Division,
KPMG Jap an
https://kpmg.com/jp/ja/home/services/advisory/web3-promotionsupport.html

18© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under the Japanese Certified Public Accountants Law and a member firm of the KPMG global organizationof independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.

Contact
KPMG JapanWeb 3.0 Promotion Support Division
web3@jp.kpmg.com
kpmg.com/jp/web3

Some or all of the services described herein may not be permissible
for KPMG audit clients and their affiliates or related entities.

The information contained herein is of a general nature and is not intended to address
the circumstances of any particular individual or entity. Although we endeavor to provide
accurate and timely information, there can be no guarantee that such information isaccurate as of the date it is received or that it will continue to be accurate in the future.
No one should act on such information without appropriate professional advice after athorough examination of the particular situation.
© 2023 KPMG AZSA LLC, a limited liability audit corporation incorporated under theJapanese Certified Public Accountants Law and a member firm of the KPMG globalorganization of independent member firms affiliated with KPMG International Limited, aprivate English company limited by guarantee. All rights reserved.
© 2023 KPMG Tax Corporation, a tax corporation incorporated under the Japanese CPTA
Law and a member firm of the KPMG global organization of independent member firms
affiliated with KPMG International Limited, a private English company limited byguarantee. All rights reserved. 23-5027
The KPMG name and logo are trademarks used under license by the independent
member firms of the KPMG global organization.
This publication contains copyright © material of the IFRS ® Foundation. All rights
reserved. Reproduced by KPMG AZSA LLC with the permission of the IFRS Foundation.
Reproduction and use rights are strictly limited. For more information about the IFRSFoundation and rights to use its material please visit www.ifrs.org.
Disclaimer: To the extent permitted by applicable law, the Board and the IFRS Foundation
expressly disclaims all liability howsoever arising from this publication or any translation
thereof whether in contract, tort or otherwise (including, but not limited to, liability for
any negligent act or omission) to any person in respect of any claims or losses of any
nature including direct, indirect, incidental or consequential loss, punitive damages,
penalties or costs.
Information contained in this publication does not constitute advice and should not be
substituted for the services of an appropriately qualified professional.
‘ISSB™’ is a Trade Mark and ‘IFRS ® ’, ‘IASB ® ’,‘IFRIC ®’, ‘IFRS for SMEs® ’, ‘IAS ® ’ and ‘SIC ® ’
are registered Trade Marks of the IFRS Foundation and are used by KPMG AZSA LLC
under licence subject to the terms and conditions contained therein. Please contact the
IFRS Foundation for details of countries where its Trade Marks are in use and/or havebeen registered.