Why Japan's Biggest Messaging App Line Decided to Create Its Own Crypto

On Aug. 31, Line, Japan's most widely utilized messaging app with more than 200 million active users, revealed the launch of its own cryptocurrency called LINK. Upon its announcement, Line immediately listed LINK on its digital asset exchange BitBox, which it launched back in July of this year.

"At the time, Line chief technology officer Euivin Park discussed the future of IT in front of the company's 1,000 developers and engineers, as well as the long-term development roadmap of Line that will allow the messaging app to evolve into an all-in-one communications platform."

"But Line also will go even further, with plans to support accelerating the development of DApp services outside of the Line platform and develop its own blockchain mainnet in the near future. To achieve this, Line is actively setting up developer bases and speeding up talent acquisition in other regions, as well as adding to Unblock and Blockchain Lab in Korea and Japan."

"Unchain will create a blockchain ecosystem fueled by a token economy, where the users are rewarded for their contributions to the network. DApp services discovered through ICON and Unblock, a subsidiary of Line dedicated to blockchain research and to accelerate DApp projects, will be integrated with Unchain."

As Line CTO Park said in April, the establishment of the Line blockchain mainnet is only the first step toward the actual initiative of the messaging giant, which is to create a tokenized economy - wherein users are compensated for all sorts of contributions, like content creation, social media presence, digital asset exchange and gaming.

Image Caption: Physical store of Line characters and stickers in Seoul, Photograph taken by Line Friends, official merchandise distributor of Line.

In the foreseeable future, Line expects LINK to be used for small purchases - like the aforementioned items - and, as its DApp and blockchain ecosystem grows, LINK is expected to have a more profound impact on Line.

The Line team explained that the long-term strategy of the company has been to create a blockchain network built from scratch that is specifically designed and structured to facilitate DApps applied to the Line messaging platform.

In the past several months, almost every major messaging application, from Line to Facebook, disclosed their interest in utilizing blockchains or integrating cryptocurrencies to their platforms, apart from one messaging platform: WeChat.

Regulatory frameworks around ICOs and cryptocurrency trading in both Japan and South Korea have significantly improved, and the positive change in cryptocurrency regulation may have contributed to the early launch of Line's native cryptocurrency, LINK. It is possible that, as regional governments - like South Korea's Jeju Island - enable ICOs and token sales, Kakao will pursue its previous plan of a token sale and a cryptocurrency launch, directly competing against Line and Naver, the messaging app's parent corporation.