🌎 Japan Revises Crypto Regulations

Japan’s Financial Watchdog Revises Crypto Regulations, Considering Securities Classification

Japan’s Financial Services Agency (FSA) has initiated closed-door discussions to revise existing cryptocurrency regulations, potentially classifying them as securities. This move could significantly impact the country’s crypto market and investors.

The FSA is reportedly considering treating cryptocurrencies as financial products similar to securities, which could lead to the introduction of spot crypto ETFs in Japan. However, this classification might also make it more challenging for retail investors to participate in the market.

Regulatory Framework and Classification

The FSA is debating whether to apply existing securities laws under the Financial Instruments and Exchange Act or introduce new rules under the FIEA or the Payment Services Act. The agency is also reviewing whether the regulations would apply to all cryptocurrencies or only major ones like Bitcoin and Ethereum.

Tips for investors:

Stay informed about regulatory updates and their potential impact on the crypto market.
Consider the potential benefits and risks of investing in spot crypto ETFs.
Keep an eye on major venture capital firms’ involvement in the crypto industry.

In October, a domestic study group released recommendations for crypto ETFs, proposing prioritization of Bitcoin and Ethereum, advancing regulatory frameworks, and applying different tax rules for crypto ETFs and spot transactions.

SoftBank’s Involvement in the Crypto Industry

Japan’s push for crypto-friendly regulation could also attract the attention of major venture capital firms. SoftBank, for example, recently backed crypto mining data center Cipher Mining. As part of the deal, SoftBank secured an option to acquire a 300MW undeveloped data center site in Texas owned by Cipher.

SoftBank reported steady financial growth, with revenues and profits increasing across all segments for the nine months ending December 2024. The company’s net income for FY2024 (Q1-Q3) rose 7.4% to 436.6 billion yen from 406.7 billion yen.