Japan's parliament has approved amendments to the Financial Instruments and Exchange Act, reclassifying cryptocurrencies as financial products under the same regulatory framework as stocks and bonds. The move, reported by CoinPost, shifts crypto out of the payments rulebook and introduces stricter enforcement, including insider-trading restrictions and enhanced disclosure requirements for token issuers and exchanges.
The amendments raise the maximum prison term for operating an unregistered crypto business to 10 years, up from three, and increase the maximum fine to 10 million yen (about $62,000) from 3 million yen (around $18,500). The changes are scheduled to take effect in 2027, according to CoinPost.
The legislation also lays the groundwork for a lower crypto tax rate and for spot Bitcoin ETFs. Lawmakers are working to reduce the tax on crypto gains to a flat rate of around 20%, down from a progressive rate that can reach as high as 55%. That tax cut is not expected to take effect until 2028. Additionally, a framework for spot cryptocurrency ETFs is being planned, with the Japan Exchange Group reportedly considering listing such a product as soon as next year.