Japan's lower house has moved forward with a bill that would classify crypto assets as financial instruments. The legislation advanced another step on June 10 after receiving approval from the House of Representatives Committee on Finance and Financial Affairs. If it is also approved by the upper house, the House of Councillors, it will take effect in 2027.
Under the bill submitted by the government in April, crypto assets would be evaluated under a regulatory framework similar to that applied to stocks. This would mean stricter trading rules for the sector. At the same time, a reduction in the tax rate on crypto gains is also on the table, with the current maximum rate of 55% potentially being replaced by a fixed 20% rate, the same level applied to stocks and bonds.
At present, Japan's top financial regulator, the Financial Services Agency (FSA), mainly regulates crypto assets under the Payment Services Act and treats them as a means of payment. The new regulation would fundamentally change this approach. Crypto-related businesses would come under much broader oversight.
Crypto Momentum Builds in Japan
The regulatory development comes at a time when Japan's crypto sector is gaining momentum, particularly in the stablecoin space.
In 2023, the country clarified its stablecoin framework through amendments to the Payment Services Act. Those changes introduced the concept of "electronic payment instruments" into legislation, allowing registered service providers and banks to issue and manage stablecoins.
Following the creation of this regulatory foundation, several industry moves followed. Fintech company JPYC Inc. announced in October 2025 that it had launched JPYC, the first legally recognized yen-based stablecoin. In February 2026, SBI Holdings and Startale Group introduced JPYSC, a trust bank-backed yen stablecoin designed for institutional and cross-border use cases.
Japan's three megabanks, MUFG Bank, Mizuho Bank and SMBC, are also planning to begin live commercial transactions within the fiscal year ending in March 2027 with a stablecoin they will jointly issue. SBI Shinsei Bank, according to Nikkei, is also considering launching a crypto rewards program for deposit customers this autumn.
Tax Reform: The Step the Sector Has Long Awaited
From the perspective of crypto investors, the most concrete impact of this regulatory shift will be felt on the tax side. In Japan, crypto income is currently classified as "miscellaneous income" and is subject to marginal tax rates of up to 55%. This has long been seen as a deterrent for crypto investors in the country.
If the new framework is adopted, crypto gains will be subject to the same fixed 20% tax rate applied to stocks and bonds. This change would serve as a major incentive for both retail investors and institutional players looking to include crypto assets in their portfolios.
The Global Context
With this move, Japan is clarifying its own framework at a time when the United States continues to debate whether crypto assets should be treated as securities. Europe’s MiCA regulation has entered into force, while Hong Kong has accelerated its licensing processes. In this context, Japan’s step can be read as a reflection of how regulatory clarity is increasingly becoming a decisive competitive factor for the global crypto sector.
The bill will now be submitted to the upper house. If approved, Japan’s crypto regulatory architecture will be significantly reshaped as of 2027.
