Japan overhauls crypto oversight as market grows to $2.66 trillion
Main Idea
Japan is overhauling its cryptocurrency regulatory framework to align with global standards, shifting oversight from the Payment Services Act to the Financial Instruments and Exchange Act, and introducing a two-tier system for token classification.
Key Points
1. The Financial Services Agency (FSA) has convened a Crypto Assets Working Group to draft a new regulatory framework, reflecting the rapid growth of the global crypto market to $2.66 trillion.
2. Oversight will shift from the Payment Services Act to the Financial Instruments and Exchange Act, with a proposed two-tier system separating ICO tokens from mainstream cryptocurrencies.
3. Japan has 12.1 million crypto accounts valued at $33 billion, prompting the need for more robust investor safeguards and scalable legal systems.
4. The FSA aims to address transparency and fraud prevention, with draft proposals expected by the end of 2025 and legislative changes likely by early 2026.
5. Taxation was a key focus of the meeting, with discussions on Web3-friendly tax rules and concerns about fraud risks.
Description
Japan is making a decisive regulatory shift to better align with the global rise in cryptocurrency markets, moving oversight of digital assets from the Payment Services Act to the Financial Instruments and Exchange Act. The change, spearheaded by the Financial Services Agency (FSA), reflects the country’s evolving approach to treating crypto as an investment product rather than a mere payment instrument. It comes as Japan’s crypto trading volumes are projected to double from $66.6 billion in 202...
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