Japan is on the verge of a major shift in cryptocurrency regulations as the ruling Liberal Democratic Party proposes a framework under the Financial Instruments and Exchange Act to regulate digital assets.
This move could pave the way for the launch of crypto ETFs in the country, potentially allowing Bitcoin and Ether-backed funds to enter the Japanese market. Startale Group CEO Sota Watanabe confirmed the proposal, highlighting efforts to redefine cryptocurrencies outside the traditional securities classification.
If approved, the new framework would enhance clarity in crypto regulations, making Japan more competitive in the global digital asset space. The proposal arrives as other countries, including the U.S., push forward with pro-crypto policies. Additionally, the potential for tax reductions from 55% to 20% could incentivize greater investor participation in the sector.
Further underscoring Japan’s shift toward a crypto-friendly stance, the financial services arm of SBI Holdings announced support for USDC stablecoin transactions, with the first transactions set to commence on March 12. This move follows Japan’s earlier restrictions on stablecoins issued by foreign entities, signaling a broader acceptance of digital assets.
With market participants increasingly optimistic, Japan’s Financial Services Agency (FSA) could lift its ban on Bitcoin and Ether ETFs sooner than expected. The regulatory shift aligns with a global trend toward cryptocurrency adoption and could bolster Japan’s standing in the digital asset space while fueling broader market discussions.
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