The fastest will be next year! Japan passes an amendment: classifies cryptocurrencies as "financial products" to strengthen regulation

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The Japanese government approved an amendment to the Financial Instruments and Exchange Act on April 10, officially classifying cryptocurrencies as “financial products” under regulation, strictly prohibiting insider trading using non-public information.

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The Japanese government recently (4/10) held a cabinet meeting and officially approved the amendment to the Financial Instruments and Exchange Act, first defining cryptocurrencies as “financial products” for regulation, explicitly banning insider trading using non-public information, and requiring cryptocurrency issuers to disclose information annually to create a healthier market environment.

According to a report by Nikkei, if the amendment passes smoothly through the current parliament, it is expected to be officially implemented as early as fiscal year 2027.

In the past, Japan’s Financial Services Agency (FSA) has regarded cryptocurrencies as “payment methods,” regulating them under the Payment Services Act. However, as crypto investments have become increasingly prominent, authorities have decided to include them under the scope of the Financial Instruments and Exchange Act, with registered operators changing their name from “crypto asset exchange operators” to “crypto asset trading operators.”

To strengthen investor protection, the revised amendment significantly increases penalties. For unregistered token sales, the maximum prison sentence will be raised from 3 years to 10 years; at the same time, the fine cap will be more than tripled, from 3 million yen to 10 million yen.

Japanese Finance Minister Shunichi Katayama emphasized at the press conference after the cabinet meeting: "In the face of the rapidly changing financial capital markets, we must…

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