Japan has licensed crypto exchanges longer than any other major market: the Payment Services Act registration regime dates to 2017, tightened after the Coincheck hack with cold-storage and segregation requirements and backed by the JVCEA self-regulatory organization. The 2022 stablecoin amendments, in force since June 2023, restrict issuance of fiat-pegged stablecoins to banks, trust companies, and licensed money transfer agents, making Japan the first G7 country with a dedicated issuer regime; trust-based yen and foreign-currency stablecoins have since launched under it.
Reclassification is now law. On July 15, 2026 the Diet passed amendments to the Financial Instruments and Exchange Act and the Payment Services Act that move crypto assets from payment instruments to financial instruments, adding insider-trading prohibitions, periodic disclosure duties for issuers and exchanges, and maximum penalties for unregistered operation of ten years' imprisonment or ¥10 million. The changes are expected to take effect in 2027, and a separate tax framework cuts the top rate on crypto gains from as much as 55% to a flat 20% from 2028. Leverage caps, listing review, and travel-rule compliance already apply under the existing framework. The FSA convenes its new On-Chain Finance Forum for the AI Era on September 30, 2026, a closed working group on tokenization and on-chain payment infrastructure whose minutes will be published.
The instruments
Payment Services Act: crypto-asset exchange registration
In forceAct No. 59 of 2009, as amended 2016/2019
Crypto-asset exchange service providers must register with the FSA: segregation of customer assets, majority cold storage, listing review, AML program, and annual audit. The 2019 amendments added custody-only services and moved crypto derivatives under the FIEA.
Penalty exposure. Unregistered exchange service is a criminal offence punishable by imprisonment and fines; the FSA issues business improvement and suspension orders.
Stablecoin regime (electronic payment instruments)
In forcePSA amendments, Act No. 61 of 2022, in force June 2023
Fiat-referenced stablecoins are 'electronic payment instruments' issuable only by banks, trust companies, and registered money transfer agents, with redemption at par guaranteed; intermediaries handling them require their own registration.
Penalty exposure. Unlicensed issuance or intermediation carries criminal penalties under the PSA.
FIEA and PSA amendments reclassifying crypto assets
Enacted, not yet in forceAmendment act passed by the Diet July 15, 2026; expected in force 2027
Classifies crypto assets as financial instruments under the Financial Instruments and Exchange Act, importing insider-trading and market-manipulation rules and periodic disclosure for issuers and exchanges, raises the maximum penalty for unregistered operation to ten years or ¥10 million, and removes a legal obstacle to spot crypto ETFs. A separate framework moves crypto gains to a flat 20% tax from 2028.
Penalty exposure. Once in force, insider trading and unregistered operation carry FIEA criminal penalties of up to ten years' imprisonment.