Japan's FSA planning to reclassify crypto assets as financial products to combat scams

From Yahoo Finance: 2025-03-31 08:18:00

Japan’s Financial Services Agency (FSA) plans to reclassify cryptocurrency assets by 2026, shifting them from settlement tools to financial products under the Financial Instruments and Exchange Act. This move aims to combat rising cryptocurrency scams and enhance oversight by imposing stricter regulations on crypto investments.

The FSA’s proposed regulations will align insider trading rules for cryptocurrencies with traditional financial products. However, specific details on these regulations have not been disclosed yet. There is also uncertainty about how the FSA will enforce these rules on foreign entities operating in Japan.

With approximately 7.34 million active crypto trading accounts in Japan as of January 2025, the FSA’s proactive approach reflects the growing interest in digital assets among the Japanese population. These regulatory changes have emerged from in-depth discussions among experts analyzing the current legal framework to address emerging risks in the crypto landscape.

Read more: Japan’s FSA Explores New Regulations To Classify Crypto as Financial Products