In a first in the country, Japanese merchants will now be covered against damages in the event of any transaction failures involving bitcoin. Transaction failures include any mishaps with payment systems or gateway issues and plausibly even transaction delays, all of which will be covered under the new insurance policy.
According to the Nikkei, the insurance package will be offered by Mitsui Sumitomo Insurance to merchants adopting the point-of-sale and/or bitcoin payments gateway infrastructure provided by Tokyo-based bitcoin startup and exchange bitFlyer. Competing bitcoin startup Coincheck is also set to offer a similar insurance product for merchants, with its partnership with Tokio Marine & Nichido Fire Insurance, sparking off a wider trend toward encouraging merchants and retailers to adopt bitcoin as a method of payment.
The merchant insurance offering will now be applicable to the likes of Bic Camera, a Japanese consumer electronics retail chain that began accepting bitcoin payments in April, after new legislation that recognized bitcoin as a legal method of payment in the country.
When Coincheck rolls out its merchant insurance service, Japanese retailer Recruit Lifestyle – also accepting bitcoin since April – will be among the clients insured. Recruit is notably including bitcoin in AirRegi, a point-of-sale app developed by the firm which will see bitcoin payments enabled at some 260,000 retail locations across Japan.
Meanwhile, Mitsui Sumitomo Insurance has already launched an insurance product for bitcoin exchanges and customers to cover losses from breaches or hacks. As reported by CCN in November, losses ranging between 10 million yen to 1 billion yen (between $88,000 and $8.8 million) will be covered by the insurance company.
There is a boom in mainstream awareness and adoption of bitcoin in Japan after it became a legally recognized method of payment in April. Japan’s financial regulator has seen up to 18 applications for licenses to open bitcoin exchanges. Ten of those applicants are new entrants to the bitcoin industry, including the likes of Japanese internet giant GMO launching its own bitcoin trading platform.
All of which sees Midori Kanemitsu, chief financial officer at bitFlyer, predicting up to 300,000 retail storefronts accepting bitcoin in Japan by the end of this year