Gushiken Yona
Japan is poised to shake up the crypto landscape. Regulators are evaluating a fundamental reclassification that could bring digital assets under the same legal umbrella as traditional financial instruments—tightening oversight, cracking down on insider trading, and potentially slashing crypto taxes.
Japan FSA Explores Amending Financial Instruments Act
Japan’s financial regulator is considering revising national law to treat cryptocurrencies as financial products, a move that would involve new rules targeting insider trading, Nikkei reported Sunday. The reported plan involves Japan’s Financial Services Agency (FSA) seeking amendments to the Financial Instruments and Exchange Act (FIEA), the country’s primary law governing securities.
According to the report, the agency is holding consultations with industry experts and aims to present a legislative proposal to the national parliament, the Diet, potentially by 2026. This would change the current classification.
Presently, cryptocurrencies like Bitcoin fall under the Payment Services Act, which largely defines them as means of settlement. The proposed revision, as reported, would place digital assets under the FIEA but establish them in a category distinct from traditional securities such as stocks and bonds.
Insider Trading Restrictions Modeled on Existing Rules
A specific goal cited in the report is the introduction of restrictions on insider trading within crypto markets. The report stated that these new rules would likely be designed to resemble the regulations already in place for conventional financial products.
The specifics of how these restrictions would apply to crypto are reportedly still under consideration by the FSA.
Japan Crypto Growth Prompts Review of Financial Regulations
This governmental review coincides with significant growth in cryptocurrency adoption and use within Japan over recent years. As digital assets are increasingly utilized for investment purposes, moving beyond their initial role as simple payment tools, regulators are evaluating how existing financial laws should apply to this evolving landscape.
The central piece of legislation under review is the Financial Instruments and Exchange Act (FIEA), which currently outlines different requirements for various types of securities and offering methods. A key challenge, as noted in reports, is determining precisely how cryptocurrencies would fit within this established framework, a detail yet to be fully clarified.
According to the report, one potential outcome of classifying crypto under the FIEA could be stricter registration requirements. These might extend to entities promoting crypto investments, potentially beyond just exchanges, partly due to rising investor complaints about misleading information. However, questions remain about how such rules could be applied to international firms.
It’s important to note this potential FIEA amendment is distinct from other recent regulatory actions. In March 2025, for instance, Japan’s Cabinet approved changes to the Payment Services Act specifically aimed at easing rules for stablecoin issuers and crypto brokerages. The reported FSA plan to revise the FIEA appears to be a separate, potentially more fundamental step focused on regulating crypto based on its investment characteristics.
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Yona has no crypto positions and does not hold any crypto assets. This article is provided for informational purposes only and should not be construed as financial advice. The Shib Daily is an official media and publication of the Shiba Inu cryptocurrency project. Readers are encouraged to conduct their own research and consult with a qualified financial adviser before making any investment decisions.
