Sony Makes Blockchain Move as Japanese Firms Flood to Web3 Space

Japanese electronics and entertainment giant Sony is entering the Web3 space in a notable shift towards embracing blockchain technology. Sony Network Communications, the company’s IT subsidiary, is poised to spearhead this innovative endeavour in collaboration with Singapore-based firm Startale Labs. 

This strategic partnership, as reported by Nikkei and confirmed through an official statement from Startale Labs, will culminate in establishing a joint venture entity, Sony Network Communications Labs, later this month. 

While Sony Network Communications has traditionally concentrated its efforts on the Internet of Things (IoT) sector, this move signifies a significant pivot towards the world of blockchain technology.

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Sony’s Blockchain Strategy

The newly formed collaboration is expected to harness the expertise that Sony brings to the table. Sony’s extensive experience across gaming, entertainment, technology, imaging, and financial services positions it as a formidable player in the blockchain space. This marks Sony’s latest stride into blockchain technology, solidifying its commitment to the Web3 landscape. 

The official launch of “Sony Network Communications Labs Pte. Ltd” is scheduled for this September, where it will draw upon the collective knowledge, skills, and networks of both entities to deliver value-added services across various sectors. Sony Network Communications holds a significant presence within the Sony Group, encompassing gaming and network services, music, entertainment technology, imaging solutions, financial services, and more.

Jun Watanabe, President, and Representative Director of Sony Network, emphasised the synergy between Sony Network Communications’ proficiency in communication, IoT, AI, and solution services, coupled with Startale Labs’ Web3 insights and technical capabilities, as the driving force behind fostering innovation on a global scale.

Sony’s Backing and Expanding Digital Horizons

In a significant development last June, Startale Labs secured seed funding from Sony, a financial endorsement enabling the company to undertake substantial expansion initiatives. With Sony’s backing, Startale Labs is set to double its workforce, growing from a team of 15 to 30 talented individuals. This expansion will bolster the company’s contributions to projects like Polkadot while embarking on innovative ventures within the Ethereum ecosystem.

Notably, Sota Watanabe, the CEO of Startale Labs, has recently raised questions regarding the United States’ commitment to advancing digital technology. According to Watanabe, Asian nations such as China, Singapore, Japan, and Korea have displayed a more open and proactive approach toward creating regulatory frameworks that support collaborations between companies like Sony and Startale in the evolving digital technology landscape.

Web3 Space in Japan

Japanese Prime Minister Fumio Kishida made a notable appearance at the WebX conference in Tokyo, where he reaffirmed the Japanese government’s dedication to nurturing the local Web3 ecosystem. This commitment aligns with Japan’s vision of leveraging Web3 technology to reshape the future of the Internet and catalyse transformative societal changes. Kishida’s remarks were delivered at the WebX conference, recognised as the largest Web3 event in Asia.

During his address, Prime Minister Kishida highlighted the potential of Web3 to drive innovation across various industries, underlining the crucial role played by events like the WebX conference in uniting stakeholders within the Web3 sphere. He expressed optimism that the Web3 industry would regain momentum and vitality, paving the way for the birth of numerous groundbreaking projects.

Japanese Corporations Embrace Blockchain

Sony has joined the growing wave of Japanese companies venturing into Web3, blockchain, metaverse, and NFT spaces. Casio recently announced NFT plans for its G-Shock watches, while sportswear giants Mizuno and ASICS have also revealed NFT initiatives. 

Mitsubishi UFJ is entering the stablecoin arena with plans for a fiat-pegged token and a digital asset wallet. Nissan launched a “Digital Web3 platform” for racing enthusiasts, Toyota sponsored a Web3 hackathon utilising the Startale blockchain, and Honda partnered with startup Animoca Brands for “Web3 fan engagement” in June. 

Japan’s Prime Minister, Fumio Kishida, expressed a strong commitment to advancing the country’s Web3 ecosystem during the WebX conference in Tokyo. He highlighted Web3’s potential for transforming the internet and society, emphasising its role in fostering innovation. This follows a document from members of Japan’s Liberal Democratic Party outlining plans to support the Web3 sector, including changes to tax rules, accounting regulations, and decentralised organisation frameworks. 

In tandem, Binance CEO Changpeng Zhao announced plans to launch crypto trading services in Japan on a new platform in August, signalling growing interest and activity in Japan’s cryptocurrency and Web3 space.

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Challenges and Opportunities

Japan has a significant presence in crypto, having recognised Bitcoin as a means of payment in 2017. Its regulations shielded FTX Japan users from the global exchange’s recent troubles, allowing them to retrieve their assets. Japan is acknowledged as a crypto-friendly nation hosting major blockchain events.

However, challenges persist. A Ministry of Economy, Trade, and Industry report identifies a shortage of entrepreneurs due to limited exit opportunities and low domestic demand for innovation. Nonetheless, Japan has enthusiastic creators eager to explore Web3, particularly NFTs. Their limited understanding of global business practices and English proficiency is the hurdle. Japan’s path to success in the Web3 arena may hinge on the emergence of a groundbreaking company that exemplifies blockchain’s potential and inspires other Japanese entrepreneurs.

Also Read: Why China Remains Hungry for AI Chips Despite U.S. Restrictions 

Conclusion

Revolutionary shifts often emerge dramatically and visibly, but in the tech realm, they can quietly and swiftly take shape, often escaping immediate notice by all. Sony’s recent strides into Blockchain, Web3, and NFTs symbolise this phenomenon. While this transition may not sit well with established Web2 giants, the progression is unstoppable. In the Web2 landscape, where internet titans hold sway, this revolution proceeds silently and is largely ignored. Yet, it is a force that can no longer be halted, reshaping the digital landscape profoundly.

Japan’s future success is intertwined with its swift adoption of crypto and Web3 technologies in an evolving decentralised landscape. The nation’s strategic efforts, corporate partnerships, and regulatory progress are positioning Japan to emerge as a force in the global Web3 space.

Frequently Asked Questions

What Blockchain Is Sony Using?

Sony Network Communications, a subsidiary of Sony, has partnered with Startale Labs to collaborate on developing a blockchain. This announcement, made on September 12, reveals Sony’s aspirations for this blockchain to serve as a foundational element of the global Web3 infrastructure while also facilitating the hosting of blockchain-based services and offerings by Sony.

What Should We Expect From Sony’s Collaboration with Startale?

In February, Sony Network Communications and Startale Labs launched a Web3 incubator focused on DAOs and NFTs, with Startale overseeing the initiative. In June, Sony’s subsidiary invested $3.5 million in Startale. CEO Sota Watanabe expressed eagerness for deeper collaboration following this capital partnership. He likened their upcoming network to Coinbase’s successful Layer 2 network, Base, highlighting Sony’s size advantage, six times larger than Coinbase, and its potential impact on Web3 technology. This suggests significant advancements in Web3 through Sony and Startale’s collaboration.

What Is Japan’s Approach to Creating a Favourable Environment for Its Growing Web3 Industry?

In April, Japan’s Liberal Democratic Party released a comprehensive white paper outlining strategies to boost local cryptocurrency adoption as part of Prime Minister Fumio Kishida’s ‘Cool Japan’ vision. This initiative aims to promote the use of blockchain technology across multiple sectors and stimulate innovation within the cryptocurrency space. Japan’s approach diverges from many trends by fostering a favourable environment for Web3 companies to prosper rather than imposing stricter regulations. This strategy seeks to nurture domestic innovation, attract foreign investments, and position Japan as an attractive hub for Web3-related projects.