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Major Japanese corporation driving cryptocurrency usage » Brave New Coin

On September 7, Kintetsu Group Holdings Co., Ltd., a company listed in Japan that primarily operates a railway connecting major cities in the Kinki and Tokai regions with tourist destinations, announced the launch of a social experiment using the virtual community currency Kintetsu Harukas Coin as part of a new smartphone-based shopping system employing blockchain technology.

The experiment will be carried out in cooperation with Mitsubishi Research Institute, Inc., a Japanese think tank. This is the second experiment following one conducted in September 2017, and the company appears to be aiming at the full-scale launch of Kintetsu Harukas Coin in early 2019.

The social experiment will be conducted between October 1 and December 10. The Kintetsu Group owns the Kintetsu Department Store chain where the experiment will be conducted in-store, in addition to 400 other locations including the Harukas 300 observatory atop the 300 meter high Abeno Harukas tower (Japan’s tallest building — located in Osaka) and the Abeno Harukas Art Museum.

Kintetsu Group’s official website is now accepting applications and users of the Kintetsu-affiliated credit card and the KIPS Card, which grants reward points for shopping at Kintetsu-affiliated stores, will be able to participate in the experiment. Over 1,650,000 people currently use the KIPS card.

To make payments, participants download an application to their smartphones in advance and simply scan a QR code with the application at participating stores. The exchange rate for the Kintetsu Harukas Coin will be one-for-one with the Japanese Yen. Users will be able to transfer coins among themselves, while participating stores are able to analyze the users’ customer base and shopping data, which can be used for sales promotions.

In an interview with The Nikkei conducted in October 2017, Mr. Kazuhito Fujita, manager at the Business Development Division, Kintetsu Group Holdings, expressed his enthusiasm for the social experiment, saying: “We have developed communities along railway lines by expanding the railway infrastructure. Going forward, we’d like to activate residents and workers who use trains with financial infrastructure.”

Interestingly, in the September 2017 experiment, roughly 90% of participants responded that they did not know anything about virtual currencies prior to the test, but over 85% of participants responded that the payment operation was easy and they want to continue using it in the future. Whether the experiment will lead to the full-scale use of the virtual community currency is attracting increasing attention. Kintetsu’s commitment to the project is high as the company is a vocal proponent of the “cashless society” and plans to include a range of value-added services for KIPS card users utilizing blockchain technology.

The Kintetsu Group test will join several virtual community currency projects are now up and running in Japan. The Hidashin Association in Gifu Prefecture started a social experiment using Sarubobo Coin in May 2017 and officially started services for the general public on December 4th last year. Sarubobo Coin is a regional cryptocurrency developed jointly by Hidashin Association and iRidge, Inc., a smartphone application development company.

The coin is available only in Takayama-shi, Hida-shi, and Shirakawa-mura and uses blockchain, which is a basic cryptocurrency technology. Users are able to make payments using the smartphone application at retail stores and restaurants.

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