A popular restaurant that accepted NEM, a virtual currency, has relocated to Tokyo from Nagoya, where it operated until last October.
Regarded as the holy grail among virtual currency fans, it is believed to be the first store in the world to exchange XEM, the cryptocurrency of the NEM platform, for actual goods.
NEM became well known to the public after it became the target of hackers last month.
Despite the controversies surrounding it, the restaurant owner wants “(people) to not decide right away that virtual currencies are suspicious.”
Yousuke Sato, 39, opened St. Arnould as a small restaurant of 20 seats specializing in Belgian beer, with over 200 varieties on offer. It was located in the second floor of a building that sells various items along the Hori River in Naka Ward, Nagoya.
In response to the request of a virtual currency user who visited the restaurant, Sato exchanged XEM for a ¥1,200 pizza on June 28, 2016. The XEM is now worth ¥54,000.
“I became interested in virtual currencies about five years ago and began tweeting about them. I thought it would be interesting to accept payment in a virtual currency, so I said yes,” Sato said.
Word spread through the internet that it was the first store in the world where XEM could be used, and St. Arnould became packed with virtual currency fans.
Last fall, after operating the restaurant for eight years, Sato decided to move to Tokyo.
He raised ¥8 million by issuing his own new virtual currency, and relocated to Akasaka in November.
In January, hackers infiltrated Coincheck, one of the largest cryptocurrency exchanges in Japan, resulting in the loss of ¥58 billion.
“I think the operators weren’t strict enough with the management of the currency. There’s nothing wrong with the concept of virtual currency itself,” said Sato.
“The market for virtual currency is still young so it’s only natural that it has become a target of speculation, but I think it has potential as a currency that is not restricted by country. I think it’s too early to say what will happen to virtual currencies in the future,” said Sato.
Virtual currencies are encrypted electronic data that are considered valuable assets and are traded on the internet. Unlike the yen or dollars, they are not guaranteed by an issuing country. Bitcoin has the highest market capitalization, at around ¥16 trillion, while NEM has around ¥500 billion. The value of cryptocurrency coins is currently skyrocketing due to speculation.
The number of stores that accept payment in virtual currencies is increasing in the Tokai region.
However, it is still rare to find people who use virtual currency to pay and send money, so it is unlikely it will be widely available like cash and digital currencies.
Two years ago, a salon in the Sakae area of Nagoya called Hair Grande Seeek began accepting bitcoin as payment.
“Digital currencies became popular all of a sudden, so I thought virtual currencies would become widely used too,” explained owner Yasuyuki Matsubara, 35.
However, only three people have opted to pay using virtual currencies so far.
“The price of cryptocurrencies keeps changing so it is difficult to use them. Most owners purchase virtual currency speculatively,” he added.
Bic Camera, a major electronics retail company, allows payment in bitcoin only if the purchase total is below ¥300,000.
According to its press release, “the service is used mostly in metropolitan areas by men in their 20s to 40s.”
According to Satoru Kado, a senior researcher from Mitsubishi UFJ Research and Consulting Co., Ltd. who is an expert on virtual currencies, there are approximately 1 million bitcoin holders in Japan, but “there is little benefit in using bitcoin to make payments or send money.”
“Virtual currency carries high risks and it’s almost like gambling, so it does not fit well with the personality of Nagoya citizens, who are prudent,” said professor Toshihiro Uchida from the Department of Economics, Chukyo University.
This section, appearing Tuesdays, features topics and issues from the Chubu region covered by the Chunichi Shimbun. The original article was published on Feb. 16.