During the Open QUICK 2026 seminar on July 10, Japanese Finance Minister Satsuki Katayama announced the government's plan to legalize cryptocurrency exchange-traded funds (ETFs) and reclassify digital assets as financial products under domestic law. The move is designed to catch up with overseas markets that already offer such products and to boost investor confidence.
The legislative groundwork has already begun. The House of Representatives passed an amendment to shift oversight of spot cryptocurrencies from the Payment Services Act (PSA) to the Financial Instruments and Exchange Act (FIEA), effectively treating crypto assets on par with traditional stocks and bonds. Once the House of Councilors approves the amendment, the new framework is expected to take effect in 2027, with a flat 20% separate withholding tax rate—replacing the current progressive miscellaneous income tax that can reach up to 55%—to be applied from January 1, 2028.
The policy change has already drawn the interest of major financial players. SBI Holdings has proposed a dual-asset ETF providing regulated exposure to both Bitcoin and XRP, as well as a hybrid investment trust combining gold and crypto ETFs. SBI aims to gather ¥5 trillion (roughly $32 billion) in assets under management within three years. Other firms, including Nomura Asset Management, Rakuten Securities, Daiwa Asset Management, and Mitsubishi UFJ-linked subsidiaries, are also studying or designing crypto ETF products. The ruling Liberal Democratic Party had previously submitted a proposal supporting the legal framework, and the Financial Services Agency is set to create a dedicated unit this month focused on crypto assets and stablecoins.
