Japan's cabinet approves bill to classify crypto as financial product

The Japanese government's cabinet on April 10 approved an amendment to the Financial Instruments and Exchange Act that officially defines cryptocurrency as a "financial product," Nikkei reported. This move shifts cryptocurrencies from their previous classification as a means of payment under the Payment Services Act, bringing them into the formal regulatory fold. The change will introduce new regulations, including a ban on insider trading using non-public information and a requirement for issuers to make annual disclosures. Consequently, the official title for related businesses will change from "crypto-asset exchange operators" to "crypto-asset dealers." Investor protection measures will also be significantly strengthened. Penalties for operating an unregistered business will be increased to up to 10 years in prison or a fine of between over 3 million yen and 10 million yen. Finance Minister Satsuki Katayama emphasized that the amendment aims to ensure market fairness and transparency. If the bill passes the Diet, it is expected to take effect as early as 2027.