Ripple and the Republic of Palau Collaborate to Mint First PSC Stablecoin

Liminal, a Singapore-based digital asset custodian, has gained regulatory approval in Abu Dhabi, as part of a series of recent steps the company has taken to expand across Asia and the Middle East. Extending digital asset custody to the Middle EastTaking to the X social media platform on May 13, the company outlined that its First Answer Middle East subsidiary received Financial Services Permission (FSP) from the Abu Dhabi Global Market's (ADGM) Financial Services Regulatory Authority (FSRA) on May 9. The approval allows the firm to provide digital asset custody in the region. Liminal had initially been granted in-principle approval last year. In a series of posts, the company outlined that it sees Abu Dhabi’s regulatory framework in respect of digital assets as forward-thinking. It drew particular attention to the work of the FSRA in developing a robust framework to enable institutions to enter the digital assets space.Photo by Sohail Sarwar on UnsplashGame changerOn the actual license approval itself, the company stated, “The FSP license allows Liminal to hold, manage, and safeguard digital assets on behalf of institutions, hedge funds, venture capitalists and professional clients. This is a game-changer for digital asset custody practices in the region.” Further regional expansionOver the course of recent months, Liminal has scored a number of regulatory successes within the Asia Pacific (APAC) and Middle East and North Africa (MENA) regions. Its success within the United Arab Emirates (UAE) has not been confined to Abu Dhabi. In April, First Answer Custody FZE, a Dubai-based subsidiary company, secured initial approval from the emirate's regulator, the Virtual Asset Regulatory Authority (VARA).  Meanwhile, Liminal's Indian subsidiary, First Answer India Technologies, has been established and registered as a reporting entity. As a consequence, it has become the first digital asset custodian registered with India’s Financial Intelligence Unit (FIU), an organization that falls under the umbrella of the Department of Revenue, and  which collects financial intelligence relative to money laundering.  Making further in-roads within the world’s most populous country in November, India’s Central Bureau of Investigation (CBI) appointed the firm with a mandate to manage seized digital assets. Liminal has ties with India insofar as it was founded by Mahin Gupta in 2021, the co-founder of crypto exchange ZebPay. In an interview with CoinDesk, Manan Vora, senior vice president of strategy and business operations at Liminal stated:"We initiated a strategic drive two years ago to secure regulatory licenses in key markets across APAC and EMEA (Europe, Middle East and Africa), strategically positioning ourselves to cater to institutional clients.” Vora added: "Our strategic vision is to expand from our present technology presence in Europe and Taiwan to pushing for regulatory victories there. In Indonesia, we are already working as a technology provider for the nation's sovereign digital asset exchange." Within its home market of Singapore, Liminal was grandfathered into a new licensing system that the city-state introduced recently in respect of digital asset custody as a consequence of already having been a provider of such services in Singapore. The company has been given a grace period of six months. Within that timeframe, it intends to submit an application to local regulator, the Monetary Authority of Singapore. 

Japan’s financial authority has decided to regulate cryptocurrencies under the Financial Instruments and Exchange Act, classifying them as financial instruments. According to a report by The Asahi Shimbun, the Financial Services Agency (FSA) intends to include this reclassification in an amendment scheduled for submission during next year’s regular Diet session. Under the revised framework, local crypto exchanges will be required to provide detailed disclosures on the 105 tokens they handle. This includes the existence of issuers, underlying technologies such as blockchain, and price volatility risks. The proposed regulations will also subject these classified cryptocurrencies to insider trading rules. Issuers and individuals affiliated with exchanges will be prohibited from trading based on material non-public information, such as the suspension of trading or an issuer’s potential bankruptcy.Photo by Karola G on PexelsToken coverage in JapanAlthough the regulatory list contains 105 tokens, data from the Japan Virtual and Crypto Assets Exchange Association (JVCEA), cited in a New Economy report, indicates that Japanese exchanges currently list 119 cryptocurrencies, leaving unclear how the remaining digital assets will be regulated.  To enhance investor protection, the FSA will mandate specific disclosure requirements for issuers that use token launches for fundraising. These entities will be required to report on their latest business activities and future issuance plans annually. This legislative push follows a discussion paper published by the FSA in April, which proposed dividing crypto assets into two distinct categories. The first category includes tokens issued for raising capital, while the second comprises established cryptocurrencies that are not primarily used for issuer fundraising, citing Bitcoin (BTC) and Ethereum (ETH) as primary examples. Tax cut from 55% to 20%In parallel with these regulatory changes, the FSA plans to request tax reforms similar to those applied to traditional stock trading. Under Japan’s current tax code, taxes on cryptocurrency gains can reach as high as 55%. The agency proposes reducing this rate to a flat 20% in next year’s tax reform. Responding to the news on X, Changpeng Zhao, the founder and former CEO of Binance, welcomed Japan’s initiative to lower crypto taxes. However, he noted that the proposed 20% rate remains high compared to other jurisdictions, many of which do not levy capital gains taxes on crypto at all. Crypto ETF CFDs set to closeThe government’s move to tighten regulations is already reshaping the financial product landscape. One immediate impact is visible in contracts for difference (CFDs) linked to crypto ETFs. As reported by FinanceFeeds, IG Securities, the Japanese subsidiary of the London-listed IG Group, announced changes to its offerings. The firm will stop accepting new orders for CFDs tied to BlackRock’s iShares Bitcoin Trust and its Ethereum equivalent on Dec. 1. Open positions are scheduled to be automatically closed on Jan. 31 of next year. If clients do not settle their holdings prior to this date, the final settlement will be calculated based on the official closing price of that final day. This discontinuation adheres to an FSA decision that derivatives referencing Bitcoin or Ether ETFs must be regulated as crypto-related derivatives rather than standard ETF products. These instruments, now under the crypto-related derivative classification, fall under stricter rules regarding investor protection, operational oversight, and licensing. Japan’s latest regulatory and tax initiatives reflect a broader effort to bring clarity and investor protection to the country’s growing crypto market. As the framework evolves, the industry will be watching how the new rules influence participation and market structure. With lower taxes and stricter oversight on the horizon, both investors and exchanges may need to adjust, potentially reshaping liquidity and Japan’s overall appeal while prompting trading platforms to rethink their product offerings. 

Japan is preparing to shift oversight of crypto assets from its payments rulebook to its main securities law, a move that would treat digital tokens more squarely as investment products rather than payment tools, according to a new report from the country’s financial regulator. In a working-group paper on crypto asset regulation released Dec. 10, the Financial Services Agency (FSA) said it plans to bring “crypto assets” under the Financial Instruments and Exchange Act (FIEA) instead of the Payment Services Act (PSA), as reported by local outlet CoinPost. The agency framed the change as an effort to strengthen investor protection as more households buy digital assets for investment purposes.Photo by Alessio Ferretti on UnsplashCrypto distinct from traditional securitiesThe regulatory perimeter itself would not expand. The FSA intends to keep using the PSA’s existing definition of “crypto assets,” while leaving non-fungible tokens (NFTs) and stablecoins outside the scope of the new framework. Under FIEA, crypto assets would be carved out as a distinct class separate from traditional securities, reflecting the fact that they generally do not confer legal claims such as dividends or interest payments. That distinction is already shaping how firms attempt to expand the economic utility of crypto assets. The move toward a clearer rulebook also arrives as market participants look for ways to construct return-generating mechanisms for assets that do not produce steady income on their own. Hong Kong–based Animoca Brands has partnered with Solv Protocol to provide Japanese institutions access to a Bitcoin-backed wrapper, according to Cointelegraph. The product is structured to generate returns in the 4% to 12% range for large holders, effectively layering yield on top of a token that otherwise provides no ongoing income. Rising retail demandThe regulator's report also details how deeply crypto has penetrated Japan’s retail market. As of October 2025, accounts at domestically registered crypto-asset exchanges had climbed past 13 million, with user deposits topping 5 trillion yen (about $32 billion). Roughly 70% of account holders fell into annual income brackets below 7 million yen (around $45,000), and more than 80% of individual accounts held less than 100,000 yen (about $640). The FSA said 86.6% of trading was driven by expectations of long-term price gains, indicating that most users view crypto primarily as an investment vehicle rather than a means of payment. Against that backdrop, the working group concluded that FIEA is a better fit than the PSA, which is geared toward payment services and anti-money-laundering (AML) controls. Shifting to the securities law would give regulators clearer authority to impose disclosure standards, govern conduct in the market, and levy penalties for unfair trading practices, the report said. The proposed framework would place heavier disclosure obligations on token issuances and initial exchange offerings (IEOs). Issuers or the listing exchanges would be required to provide key information to investors, and, in cases where an issuer does not have audited financial statements, offerings would be subject to investment limits. Crypto exchanges would face stronger due diligence requirements, tighter cybersecurity expectations, and broader insider-trading restrictions. Those rules would not only apply to employees at trading platforms but also to issuers and other insiders around listing events. Rules split for CEXs and DEXsCentralized exchanges (CEXs) would be supervised largely in line with securities firms. That would include requirements to maintain reserves or insurance to protect customer assets and expanded oversight of wallet-service providers connected to those platforms. Decentralized exchanges (DEXs), which have no central operator, would not be brought under the same regime. Instead, the FSA is proposing lighter, perimeter-based rules focused on disclosures by wallet providers and interface operators, coupled with efforts to warn users about the specific risks of trading on DEXs.  Industry participants, meanwhile, have raised concerns that licensed exchanges may face higher compliance costs in the near term as they adapt to the new regime.  Moving forward, the FSA is expected to refine the framework with an eye toward submitting a bill to the ordinary Diet session in the new year.