Japan is preparing to launch spot Bitcoin ETFs by 2028, aiming to replicate the success of the US market while leveraging its unique advantages. In the US, spot Bitcoin ETFs have grown to a peak of $200 billion in about two and a half years, driven initially by retail investors and later by institutions. A panel at WebX 2026 discussed how Japan can surpass the US model by integrating crypto ETFs into broader wealth-building frameworks.
US market: rapid growth and investor composition
BlackRock Japan director Keisuke Jo revealed that one US Bitcoin ETF reached $80 billion in assets under management in about two years, compared to the typical eight years for a traditional ETF. In the first year, retail investors accounted for roughly 80% of inflows. Gradually, institutional investors entered, and the current split is approximately 50% retail, 25% wealth management via IFAs, and 25% institutions. Jo noted that ETFs serve as a bridge between traditional finance and digital assets, attracting new investors from both sides.
Japan's potential: tax reform and household assets
Japan has 14 million crypto trading accounts despite a punitive tax system—up to 55% on gains, no loss offsetting, and mandatory self-declaration. SBI Global Asset Management CEO Tomoya Asakura argued this represents a floor, not a ceiling. If crypto ETFs become available in securities accounts with a flat 20.315% tax rate and loss offsetting—expected by 2028—they could tap into Japan's ¥2,386 trillion household financial assets. Just 1% flowing into crypto ETFs would exceed the entire US AUM. Asakura emphasized that Japan can position crypto ETFs as a diversified portfolio component from day one, avoiding the speculative frenzy seen in the US.
Product innovation: from spot to derivatives
US crypto ETF innovation has moved beyond simple spot products. Jo outlined a range: multi-coin index funds, market-cap-weighted products, staking ETFs, premium income strategies (selling call options on Bitcoin), leveraged and inverse ETFs, and principal-protected structures. These draw on traditional ETF techniques adapted for digital assets. Staking, particularly for Ethereum, is under discussion for inclusion in US ETFs, though regulatory approval is pending.
Design considerations for Japan
Tokyo Stock Exchange listing promotion chief Takashi Kikuchi noted that ETF listing involves choices between domestic and foreign structures, and cash versus in-kind creation. In-kind creation requires broker readiness. Nomura Asset Management's Yushun Mizusaki advocated starting with simple 100% crypto exposure products for investor asset allocation, then expanding to balanced funds that include crypto for beginners. Derivatives-based strategies are popular in the US but would disqualify ETFs from NISA tax-free accounts in Japan.
Why choose ETFs over direct holdings?
Even with equal tax treatment, ETFs offer advantages: purchase through securities accounts, beneficiary protection under trust law, and professional custody by trust banks or custodians, reducing hacking risks. Mizusaki stressed that the structural safety and convenience differentiate ETFs from direct crypto holdings.
Outlook for 2028: public-private collaboration
Panelists expressed optimism about 2028. Jo aims to make crypto ETFs a normal part of diversified portfolios. Kikuchi highlighted the TSE's ETF market, with over 400 listings and ¥100 trillion in net assets, as a strong foundation. Asakura envisioned a future where new employees buy crypto ETFs via salary deposits in JPYC, and grandparents accumulate them for grandchildren through local banks or post offices. He urged the government to include crypto investment trusts in NISA, child NISA, iDeCo, and defined-contribution pension plans, warning that without such inclusion, crypto ETFs would remain speculative products rather than core asset-building tools.