Japan Prepares Major Crypto Regulatory Shift
Japan is moving to reclassify cryptocurrencies as financial products under its Financial Instruments and Exchange Act, marking a significant regulatory overhaul. The draft amendment, currently before the Cabinet, would shift crypto oversight from the Payment Services Act to the same framework governing stocks and securities. If approved during the current legislative session, the new law could take effect in fiscal 2027. The regulatory change reflects crypto's evolution from a payment method to an investment instrument. Japan's Financial Services Agency is also implementing substantially harsher penalties for violations, including increasing maximum prison sentences from three years to ten years for operating without registration and raising fines from 3 million yen to 10 million yen, approximately $62,000.
