Japan Moves Crypto Assets Under Financial Instruments and Exchange Act, Laying Legal Foundation for Crypto ETF

Coin Circle (120btc.CoM): Japan's crypto ETF timeline has been set for 2028, with both pieces of the regulatory puzzle now in place.

On July 15, Japan's National Diet passed a law in its third reading, moving crypto assets from the "Funds Settlement Act" to the jurisdiction of the "Financial Instruments and Exchange Act," effectively recognizing them as investment products rather than just payment tools, thus providing a basis for ETF issuance. The tax aspect has also been determined; according to the 2026 tax reform outline, eligible crypto assets will be subject to a separate tax rate of 20.315%, the same as stocks, expected to take effect on January 1, 2028, with Japan's crypto ETFs likely to be listed in the same year. The remaining variable is who can sell them.

ETFs Can Only Be Sold by Securities Firms, Public Investment Trusts Can Sell at Post Offices

SBI Global Asset Management President Tomoya Asakura directly calculated at WebX 2026. Japan's total household financial assets amount to approximately 2,400 trillion yen; if just 1% flows into crypto ETFs, the scale would exceed the entire current U.S. market. In terms of exchange rates, that 1% is about 160 billion USD.

The problem is that this money is not in securities accounts. Asakura's solution is to package the ETF into public investment trusts, stating, "In Japan, integrating ETFs into investment trusts has more potential," because public investment trusts can be sold not only by securities firms but also by local banks, postal savings banks, and nationwide post offices, creating a completely different level of distribution.

He made it clearer, "Otherwise, Japan will end up like the U.S., where it ultimately becomes just a speculative product." In his vision, crypto assets should be included in a long-term diversified asset allocation, using either a one-time investment or a regular investment approach, through existing financial institutions to reach ordinary households.

Frequently Asked Questions

What will the tax rate on Japanese crypto assets be reduced to?
According to the 2026 tax reform outline, eligible crypto assets will be changed from a maximum comprehensive tax rate of 55% to a separate declaration tax rate of 20.315%, the same as stocks, expected to take effect on January 1, 2028.

When will Japanese crypto ETFs be available for purchase?
The law passed on July 15 has moved crypto assets under the jurisdiction of the "Financial Instruments and Exchange Act," providing a basis for ETF issuance. The market expects the earliest listing to be in 2028, with Nomura Asset Management and SBI's investment trust company already developing products.

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