Japanese regulator proposes to recognize cryptocurrencies as financial instruments
Date: 2025-09-05 Author: Oliver Abernathy Categories: IN WORLD
The Japanese Financial Services Agency (FSA) has proposed extending the FIEA to cryptocurrencies. The regulator noted that the problems associated with digital assets largely coincide with the issues regulated under this law. This includes insufficient disclosure of information, ambiguous wording in documents, unlicensed activities, fraudulent schemes, as well as risks associated with the security of exchanges and low market stability.
According to FIEA, digital currencies will be recognized as financial instruments, which will oblige their issuers to disclose more information about projects and comply with the principles of fair trade. According to the FSA, such measures will help protect investors and create more transparent conditions in the market.
The popularity of cryptocurrencies in Japan continues to grow: the number of registered accounts on exchanges has exceeded 12 million, and the total volume of deposits has reached 5 trillion yen (about $33.7 billion). However, large investments are rare: more than 80% of individual traders hold amounts below $675.
FSA research has shown that about 7.3% of Japanese with investment experience own cryptocurrency. Among them, about 70% belong to the middle-income category. At the same time, the overwhelming majority - 86% of digital asset holders - consider them as long-term investments, expecting an increase in value in the future.
The regulator's proposal appeared shortly after the statement of Finance Minister Katsunobu Kato. According to him, cryptocurrencies can take a worthy place in the portfolios of private investors, since they provide asset diversification. Despite high volatility, Kato noted, digital currencies can be useful as an investment tool, subject to strict regulation.
Thus, Japan is taking a step towards more formalized regulation of the cryptocurrency sector. Recognizing digital assets as financial instruments should increase confidence in the market, minimize fraudulent practices, and strengthen the position of cryptocurrencies in the country's investment environment.
