Japan’s Financial Services Agency (FSA) is set to amend the Financial Instruments and Exchange Act to officially classify cryptocurrency assets as financial products and introduce new insider trading regulations.
The proposed changes aim to curb unfair trading practices and improve investor protection in the rapidly evolving cryptocurrency market.
According to the FSA, the revised legislation will prohibit individuals from trading crypto assets based on undisclosed inside information, mirroring regulations that apply to traditional financial markets. The move reflects the growing recognition of cryptocurrencies as mainstream investment vehicles and aims to strengthen oversight amid growing market participation.
In order to develop a comprehensive framework, the FSA has been holding closed-door working sessions with experts since October 2024 to assess the current regulatory structure and identify areas for improvement. The bill is expected to be presented to the Japanese National Diet (Japanese Assembly) by 2026.
Japan has been at the forefront of crypto regulation, implementing strict exchange licensing requirements following high-profile hacks in previous years.
*This is not investment advice.
