- Japan’s FSA proposes to regulate crypto assets under FIEA as investment products.
- Increased transparency and regulatory oversight planned for exchanges.
- Potential insider trading prohibitions and new disclosure mandates considered.
Japan’s Financial Services Agency proposes shifting crypto regulation from the Payment Services Act to the Financial Instruments and Exchange Act, enhancing disclosure requirements and empowering oversight on both domestic and foreign platforms.
This potential regulatory change could significantly impact crypto exchanges, intensifying oversight and aligning crypto with traditional investment products, potentially leading to market consolidation in Japan.
FSA Proposal: Crypto Assets as Financial Instruments
Japan’s FSA has presented a proposal to transfer crypto assets from the Payment Services Act to the FIEA, aiming to treat them as investment products. Strengthening IEO disclosure requirements and empowering regulators to address unregistered platforms are central to the plan. According to the FSA, “We are moving towards reclassifying certain cryptocurrencies to fall under FIEA-style rules, with stricter audits, disclosures, and registration for third-party wallet providers and trading-system operators.”
The proposed regulatory shift focuses on enhancing oversight and transparency, requiring exchanges to adhere to new disclosure standards and maintain liability reserves or insurance. These changes aim to solidify investor protection and standardized operational frameworks for exchanges.
Industry representatives have voiced concerns over the potential economic burden, particularly for smaller exchanges that might struggle with increased compliance costs. However, some exchanges perceive it as a vital step toward legitimizing the industry and attracting institutional players.
Enhanced Oversight and Industry Challenges
Did you know? Japan previously tightened regulations after the Coincheck hack in 2018, which significantly impacted industry practices and investor confidence.
As of 14:02 UTC on December 10, 2025, Bitcoin (BTC) trades at $92,066.69 with a market cap of $1.84 trillion, according to CoinMarketCap. BTC’s 24-hour trading volume reached $66.63 billion, marking an 18.98% change, with a circulating supply of 19,960,203 BTC.
The Coincu research team suggests that regulatory shifts may prompt other nations to evaluate similar approaches, potentially paving the way for increased global standardization and investor confidence in cryptocurrency markets.
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