Japan’s Financial Services Agency (FSA) plans to reclassify cryptocurrencies as financial products under new regulations aimed at reducing insider trading in the digital asset market, according to a Sunday report by Nikkei.
This initiative is part of a broader strategy to enhance oversight within Japan’s crypto ecosystem, which has seen increased adoption alongside rising fraudulent activities.
The FSA plans to propose amendments to the Financial Instruments and Exchange Act (FIEA) to Japan’s parliament as early as 2026, following a detailed review by experts behind closed doors.
Currently, cryptocurrencies are categorized as a “means of settlement” under the Payment Services Act, primarily governing their use as payment tools rather than investment vehicles. However, this classification has left gaps in regulatory oversight, especially regarding insider trading.
