"Japan's Barrier is Not Culture but Local Investment" - Huobi Co-founder Du Jun Discusses Regulations, Stablecoins, and Expansion in Asia

Key Points of This Article

• Regulations are inevitable, says Du Jun on the role of RegTech
• The next growth area is stablecoin payments and RWA
• The key to conquering the Japanese market is serious local investment

A revised law transferring the regulation of cryptocurrency trading from the Payment Services Act to the Financial Instruments and Exchange Act was passed and enacted on July 15, 2026. As cryptocurrencies are positioned as financial products and the integration of the industry into the financial system progresses, operators are required to establish compliance systems more than ever before.

Du Jun, co-founder of Huobi, is currently focused on the AI-native compliance platform "WIDTH" based in Singapore. Why are regulations inevitable? Where is the next growth area? Why is the Japanese market challenging? CoinPost interviewed Du Jun on October 9, in conjunction with TOKEN2049 held in Singapore from October 7 to 8, 2026.
Du Jun
WIDTH | Founder and Chairman
Co-founder of Huobi. Co-founder of ChainUP, which develops systems for exchanges, founder of blockchain media Jinse Finance, and founder of investment firm Vernal Capital. He stepped down as CEO of Bitfire Group Holdings (formerly Sinohope Technology Holdings, stock code 1611) listed in Hong Kong on August 26, 2025, and became a non-executive director.

Editor’s Note: WIDTH was established based on the acquisition of Cynopsis Solutions, a RegTech company founded in Singapore in 2014, by Vernal Capital, founded by Du Jun. Its headquarters is in Singapore, and the co-founder and CEO is Chye Kit Chionh, while Du Jun serves as founder and chairman. It supports regulated entities across financial institutions, fintech companies, digital asset operators, and payment companies throughout the APAC region.

Reasons Why Regulations are Inevitable

Starting from exchange-related businesses like Huobi and ChainUP, we are now focused on the RegTech company WIDTH. Why did we choose to enter the compliance field at this timing?
WIDTH is not a trendy business. Compared to perpetual futures DEXs or prediction markets, it is a very labor-intensive job. We acquired a company with a 12-year history and are rebuilding it from scratch, which takes 3 to 6 months for a contract with a single client, and in some cases, up to 1 to 2 years. B2B companies are not inherently the most fashionable.

The most profitable entities in the industry have always had elements of regulatory arbitrage, whether they were early exchanges or some of today’s platforms. While there has certainly been product innovation, it cannot be denied that there was room for regulatory arbitrage.

More importantly, today, new cryptocurrency exchanges and decentralized exchanges like perpetual futures DEXs face significant questions about how to deal with regulations. Once they reach a sufficiently large scale, regulatory authorities will inevitably seek dialogue and include them in the scope of regulation.

From 2017 to 2022, the industry was focused on when licenses would be issued. In many regions, they were not issued, and some regions stated they would never be issued. On the other hand, Japan was one of the first countries to issue licenses. My view has always been that regulations will come, and licenses will definitely be issued.

Why have I always believed that regulations are coming? The market size influences the level of interest and resources that regulatory authorities invest, but it is not the only factor. Risks such as anti-money laundering, investor protection, and financial stability are always present. As the number of users increases and the scale of business expands, the need for regulatory authorities to establish clear and enforceable rules becomes even more pressing.

Today’s cryptocurrency market has already reached a considerable scale. Considering RWA, stablecoins, and the tokenization of traditional financial assets, the potential market becomes even larger. For example, the total market capitalization of NASDAQ-listed companies has already reached tens of trillions of dollars.

This indicates that there is significant room for on-chain transformation of traditional assets, but the potential space cannot be directly equated with the size of the already realized tokenization market. Markets like NASDAQ and Hong Kong are also exploring the tokenization of stocks and extending trading hours.

As the market continues to expand, the motivation for regulation will also strengthen. Economic activities, tax revenue, and financial stability will enter policy considerations, and consumer protection, anti-money laundering measures, and market fairness will also be equally important. Especially for businesses targeting retail customers, regulatory authorities tend to place greater emphasis on licensing requirements and risk management.

Our primary goal in establishing this company is to help exchanges, whether decentralized or centralized, build good dialogue methods and systems with regulatory authorities.

From onboarding, KYC, KYB (corporate verification), to KYT (transaction monitoring), our products are all designed to facilitate dialogue with authorities in their language. We are fundamentally different from RegTech companies that only sell KYC APIs. We provide a complete solution and show how to proceed, and in some cases, assist in dialogue with authorities.
Editor’s Note: The total market capitalization of NASDAQ-listed companies was approximately $45.7 trillion as of late April 2026.

Compliance as Remedial Education

In June 2026, in a more mature capital market, exchanges will become like retail-focused securities companies, requiring remedial education in resources such as licenses, compliance, and institutional investors. Is WIDTH indeed helping with that remedial education?
I hope so, but from the operator's perspective, they may not necessarily want that. Would decentralized exchanges like perpetual futures DEXs desire strong regulations? At the stage where they are not subject to serious crackdowns from authorities, they are not targets for sanctions or legal actions and are doing well. Their top priority is acquiring new users, new traffic, and new markets. Therefore, at this stage, they do not desire regulation, nor do they need our involvement.

What we can do is help build risk identification and compliance record mechanisms from the early stages of the business while minimizing the impact on onboarding costs and user experience as much as possible. In the future, when regulatory authorities conduct inspections, the platform will need to provide evidence that it has continuously identified, assessed, and addressed risks.

For example, if a deposit address is related to sanctioned individuals or other high-risk funds, the platform should take measures such as restrictions or reporting based on applicable laws, risk policies, and investigation results. Many of the cases we are currently supporting are precisely this, helping to identify such high-risk addresses.

For instance, a few years from now, when authorities ask why there were large transactions with a certain high-risk address, can we show the screening results, investigation records, and the basis for our responses at that time? What authorities focus on is whether the operator identified the risks, took reasonable measures, and can explain the decision-making process.

If issues are pointed out during inspections, operators must promptly develop improvement plans and implement effective measures. The introduction of regulatory compliance software or requests to auditing firms can be part of the improvement measures, but ultimately what will be questioned is whether the system is actually operational, whether issues have been rectified, and whether records are sufficiently maintained. Simply implementing a system does not guarantee leniency from authorities, nor does it replace legal compliance obligations.

Next Growth Areas

Where do you see the next stage of growth for cryptocurrencies coming from—trading, payments, compliance, or custody?
At this stage, I personally do not prioritize investment in exchanges. I see exchanges as a maturing financial intermediary, and competition is becoming increasingly fierce. While the business models and profitability of exchanges vary greatly, in my investment judgment, the issuance of assets and the related infrastructure are more noteworthy.

What is now more important is the issuance of assets. I believe the two most important aspects are.

One is stablecoin payments. Payments based on stablecoins are a very significant theme, whether it be infrastructure development, issuance, circulation, or future applications. Therefore, we have been investing in industries related to stablecoins for a long time.

The second is RWA (Real World Assets). I differentiate between standardized and non-standardized assets. For the next three years, standardized assets, such as bonds and stocks, will be the focus. Standardized assets are progressing very quickly, and the opportunities are enormous. This is a market worth one trillion, ten trillion, or even one hundred trillion dollars. They are more easily accepted by the general public compared to native crypto projects, making it easier to capture a large market.

Additionally, it is possible to launch projects or issue memes to make some pocket money. But frankly speaking, they do not create value.

Blockchain Technology Will Integrate into More Industries

There are many discussions about crypto as an industry, especially with the fusion of AI. How do you see the future of crypto?
So far, I have not seen a representative example where crypto-native and AI-native products have sufficiently matured and connected as user-facing products. There are many concepts, but whether they will become sustainable applications needs to be verified over time. On the other hand, in specific scenarios such as on-chain risk identification, compliance analysis, and review assistance, AI is already being utilized. This is also what WIDTH is working on. In the long term, I believe the significance of categorizing crypto as an independent industry will diminish, and the functions of blockchain will blend into finance and other industries.

Is Binance a company in the crypto industry? Of course, that can be said. Is Visa, which is currently using stablecoin payments, part of the crypto industry? Ten or twenty years ago, saying we are an internet company was quite cool and fashionable. Now, such introductions are rarely made.

Crypto is just a technology, like the internet. Blockchain is a ledger technology that has solved many problems in the financial sector through its characteristics of censorship resistance, openness and transparency, and immutability.

Currently, the best application scene for blockchain is payments, and the largest payment is undoubtedly stablecoin payments. The biggest scenes are payments, asset transfers, finance, and the confirmation of rights to financial assets. What is most important now is to strengthen stablecoins significantly and, in extension, work on the confirmation and transfer of asset rights.

Decades ago, banks were not called "abacus banks" just because they used abacuses, nor were all banks called "computer banks" just because computers emerged. It is a technology and a fusion.

The best state of blockchain is that, like rain nourishing everything silently, its elements gradually mix into every industry and penetrate into the genes. It should not become an independent category but exist like water.

Expansion in Asia and Plans to Visit Japan

Laws and reporting standards vary by region. Currently, more than 60% of WIDTH's customers are based in Singapore, but how will you expand into overseas markets like Hong Kong and Japan in the future?
First, it is necessary to know which markets I will not enter. I do not foresee entering the European and American markets within the next three years.

In June 2026, we established our first office for overseas markets in Hong Kong. We plan to set up an office in Dubai for the Middle East, initially scheduled for the fourth quarter of 2026, but we are now slowing down the pace, and it is expected to be in the first quarter of 2027. In Japan, Taiwan, and Malaysia, we have personnel handling sales and business development who are observing the markets.

Recently, we have also participated in industry associations and summits in Japan, the Philippines, Malaysia, Indonesia, and Vietnam. Currently, the focus is on establishing a system where Hong Kong serves North Asia, Dubai serves the Middle East, and Singapore serves Southeast Asia.

I plan to visit Japan in early December 2026. Since there is already a group office in Japan, I will check the situation then.

Challenges in the Japanese Market

Many projects we encounter say that the Japanese market is very difficult to penetrate. What is your view?
I agree that the Japanese market is somewhat more challenging compared to other markets for two reasons.

One is the team itself. Whether it is overseas expansion or anything else, if the management does not physically reside in that area, it is difficult to establish a business. Japan is even more challenging. Japanese culture tends to emphasize localization and is more conservative, which can pose challenges for the acceptance of products from outside.

However, I do not think this is the core issue. The core issue is whether one is seriously managing the business and genuinely connecting with the local market. Yahoo Japan has likely succeeded. There are many international companies that are very successful in Japan.

The core issue is whether there is a true willingness to invest in that area. Investment is not just about money; it is about genuinely connecting with the local market. Is there a relationship with local shareholders? Are local financial compliance policies and market strategies being developed locally?

Or is the global strategy of the group and the approach to mature markets being directly applied? It is about whether one is truly putting in 100% or even 200% of their effort, time, cost, and attention into managing the business. If so, I believe there are no markets that are particularly difficult to penetrate.

Japan has a very mature capital market. While there may be some challenges compared to English-speaking countries or more inclusive nations, that is not a core issue. The core issue lies within oneself.

Whether it is policies, regulations, or users, can one truly understand the local market sufficiently? And what value have they created? If it is just a little trial, the chances of success will be low.

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