Japan To Recognize Cryptocurrencies As Legal Financial Products

The Japanese financial regulator is allegedly working on a plan to consider cryptocurrencies as financial products under law. The information has been shared by a local newspaper.

According to Reuters, this Sunday, the Japanese newspaper Nikkei—a respected publication in the financial industry—said that Japan’s Financial Services Agency (FSA) will revise the Financial Instruments and Exchange Act to change cryptocurrencies’ status to financial products.

The report shared by the Japanese paper explained that a new bill will be submitted to the parliament by 2026 to adjust the law with a new amendment for this. However, no specific sources were cited.

According to CoinDesk, the new criteria will consider similar regulations to conventional financial products, although no details were provided. At the moment, cryptocurrencies are considered “means of settlement” under the law and can be used as a payment tool, but the FSA has noticed gaps that are not being regulated and can encourage unregulated activities.

The new initiative comes after a rise in scams related to cryptocurrencies and recent private discussions among experts.

On March 6, the North American Securities Administrators Association (NASAA) warned about the increasing scams related to digital currencies and the use of new AI-powered technologies.

“This year, the most critical threats include financial scams tied to digital assets and cryptocurrency, social media apps, and marketing tactics designed to play on emotions.”

A few days ago, a new crypto-scam affecting Reddit users was unveiled by cybersecurity experts, and Microsoft recently warned about the StilachiRAT malware targeting digital wallets.

These new regulations also come after other countries have made some changes in their cryptocurrency management. In January, the United States announced a plan to develop cryptocurrency regulations and, a few days ago, a cryptocurrency reserve including seized Bitcoin as well as other currencies.