Japan's upper house passed a landmark bill reclassifying cryptocurrencies from payment instruments to financial products under the Financial Instruments and Exchange Act. The law renames exchange operators to crypto trading firms and significantly raises penalties: maximum jail time for unregistered sales jumps from three years to 10 years, and fines increase from ¥3 million to ¥10 million. Insider trading rules are introduced for crypto, banning trades based on nonpublic information, and specific token issuers must make annual disclosures.
Tax changes and market moves
Tax treatment will shift in 2028, with crypto gains subject to a 20% separate withholding tax and allowing three-year loss carryforwards. That replaces the current 55% comprehensive income rate, a major relief for investors. Meanwhile, SBI Global Asset Management partnered with DigiFT to launch JX, a tokenized investment product on Solana offering exposure to Japanese high-dividend stocks for qualified and institutional investors. The tokenized real-world asset market has surged to $21.9 billion from $5.9 billion last year, according to the Solana Foundation.
South Korea and Binance developments
South Korea's Ministry of Economy and Finance is drafting a law to manage state-owned crypto assets, treating them as a distinct asset class. The government also adopted an economic growth strategy that includes a Digital Asset Basic Law in the second half of 2025, covering stablecoin regulations and cross-border payments, with a 2027 pilot for tokenized government bonds. Separately, Binance added 10 tokenized stocks as eligible collateral for cross-margin and unified accounts, including Alibaba (BABAB) and TSMC (TSMB), allowing users to leverage positions in major Asian equities.
DeepSeek revenue and OKX trading
Alibaba-backed AI lab DeepSeek disclosed annualized revenue of $400 million to $500 million, driven by enterprise and developer API usage. Gross margins on its V4 API exceed 50%, aided by infrastructure optimizations. The company is raising an additional 50 billion yuan at a valuation of about 500 billion yuan ($74 billion), with plans to accept dollar investments from Middle Eastern and other overseas funds. OKX will launch tokenized US equities trading on July 16, offering price exposure to stocks and ETFs with tokens prefixed 'X' (e.g., XNVDA, XTSLA), settled via Solana and X Layer networks, tradeable 24/7 against USDT, with zero maker fees until September.
South Korea tax debate and JCB-Circle partnership
South Korea's National Tax Service is setting up a digital asset unit for a 2027 crypto tax launch, but a 50,000-person petition to repeal the tax remains off the legislative agenda. Under current law, crypto gains over 2.5 million won face a 22% tax, while stock trading profits are exempt, drawing criticism for unequal treatment. On the payments front, Japanese credit card issuer JCB signed an MOU with Circle to explore USDC stablecoin use for payments and cross-border treasury operations, aiming to promote regulated stablecoin adoption in Japan.