Japan’s COVID-19 stimulus payments were not used to invest in cryptosystems


In April, the Japanese government began distributing JPY 100,000 in payments, about USD 930, to each household. But did the Japanese follow the example of some people in the United States and spend that money on cryptomoney exchanges? Data from the three major cryptosystems exchanges in Japan suggest that they probably did not.

In his latest report, Yuya Hasegawa, a market analyst at the Bitbank exchange indicates some „irregularities“ in the month of June in terms of deposits, but in general he concludes that the coronavirus aid payments did not result in significant changes in the behavior of Japanese crypto-investors.

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There were some changes to normal. The number of JPY 100,000 deposits from 40-year-old investors increased by more than 36%, surpassing that of 20-year-old investors for the first time in two months. The number of JPY 100,000 deposits from 50-year-old investors increased by more than 35%.

But according to Hasegawa, those changes are „too miniscule to alter overall investor behavior significantly. Comparing the number of deposits in June with „previous months that recorded roughly the same amount of monthly Bitcoin Lifestyle volume in the past (i.e. September 19〜Dec 19“), he noted:

„The number of deposits and the degree of increase is a bit small to conclude, with confidence, that a number of Japanese investors are using their stimulus checks to buy cryptosystems (emphasis on ‚a number of‘)“.

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BitFlyer and Coincheck in the Covid-19 Stimulus Control
Cointelegraph asked BitFlyer and Coincheck exchanges to check the number of JPY 100,000 deposits since April. Overall, the results confirmed that the Covid-19 stimulus payment had little impact on cryptomoney purchases.

BitFlyer compared February with April, May and June. The number of JPY 100,000 deposits increased from 1.1 to 1.2 times from April to June. The rate of increase was small and BitFlyer said he could not conclude whether the number was driven by the coronavirus rescue stimulus.

According to Coincheck, the number of JPY 100,000 deposits gradually increased between January and April, but stopped rising in May. It declined in the second quarter compared to the first.

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Why the small impact?
Why did Japanese investors avoid using the ransom money for crypto investments? Hasegawa suggested that it might be related to the „trend characteristic of the Japanese consumer towards investment“:

„In Japan, average households allocate only about 15% of their funds to financial products (excluding insurance, pensions and the standard guarantee scheme) and just over 50% to savings, while average households in the US and the EU allocate more to financial products and less to their savings.

As reported by Cointelegraph, on July 13, the Bank of Japan revealed that the country’s supply of M3, essentially the volume of deposits from individuals, corporations and local governments, excluding financial institutions, increased by 5.9% in June to USD 13.5 trillion.