Japan's Financial Services Agency (FSA) is evaluating a policy that would permit domestic banks to hold cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH), marking a potential significant regulatory shift as of October 2025. This move aims to integrate digital assets into traditional finance, potentially unlocking institutional capital and boosting market liquidity.
The FSA's review focuses on expanding banking operations under recent regulatory deliberations, building on Japan's history of crypto oversight, including the 2017 Payment Services Act that established custody and anti-money laundering rules. In 2025, the Financial Instruments and Exchange Act (FIEA) reclassified crypto assets as financial products, setting a precedent for broader inclusion. Analyses project that lower capital gains taxes and global regulatory trends, such as those in Hong Kong and Switzerland, could drive increased trading volume and price appreciation for major cryptocurrencies.
A statement attributed to FSA leadership emphasizes, "The ongoing examination of crypto-asset regulation is part of our commitment to ensure a safe and stable financial environment." If enacted, this policy could reshape Japan's financial landscape by fostering institutional trust and adoption, though actual impact depends on legislative execution and market response.
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