If it is, this is quite scary because if anything goes PEAR SHAPED in JAPAN the market will go down even further and we do not want that to happen at all. I do think though that much of the JAPANESE volume is also created by many CHINESE who cannot do anything in CHINA because of all the bans there, so they have moved all their volume to JAPAN. This is just my theory and I do not have proof to back it, but this is just an assumption that comes from pure logic I guess. I do hope more countries get more active in the markets.
I disagree. Why would a Chinese goes to a Japanese exchange to do transaction? No one that I know of did any transaction in Japan unless he has a friend there. For a Chinese to do transaction in Japan, he needs to access the Japanese exchanges which might be blocked, and he has to understand Japanese, and verify his Identity, which might be very difficult.
The situation in China is a lot of big Chinese exchanges ( now situated in HK, or nearby foreign countries) have been blocked by greatwall, or undergone some DNS attack recently. So you need VPN or VPS to visit them. That limits the number of Chinese investors who can visit those sites.