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

On April 10th, the Japanese government passed an amendment to the Financial Instruments and Exchange Act, officially classifying cryptocurrencies as “financial products” under regulation for the first time, and strictly prohibiting insider trading using non-public information.

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Recently (4/10), the Japanese government held a cabinet meeting and formally approved the amendment to the Financial Instruments and Exchange Act, which for the first time classifies cryptocurrencies as “financial products” for regulation, explicitly bans insider trading using non-public information, and requires cryptocurrency issuers to disclose information once a year to create a healthier market environment.

According to Nikkei News, if the amendment passes smoothly through this session of Congress, it is expected to be officially implemented as early as 2027.

In the past, Japan’s Financial Services Agency (FSA) has regarded cryptocurrencies as “means of payment” and regulated them under the Payment Services Act. However, as cryptocurrency investment becomes increasingly prominent, authorities have decided to include them under the scope of the Financial Instruments and Exchange Act, and the registration name for operators will change from “crypto asset exchange operators” to “crypto asset trading operators.”

To strengthen investor protection, the new 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 ensure fairness, transparency, and investor protection while expanding growth capital supply.”

• This article is reprinted with permission from: “BlockTalk”
• Original title: “Implemented as early as next year! Japan’s Cabinet passes amendment: classifying cryptocurrencies as ‘financial products’ to strengthen regulation”
• Original author: Block Sister MEL