Japanese Finance Minister Satsuki Katayama affirmed the essential Vai of stock exchanges as the primary gateway for digital assets, marking a strategic move to integrate blockchain into the traditional financial system.
Japan is reshaping its approach to crypto assets by bringing digital assets under the strict regulatory framework of traditional markets. Finance Minister and Financial Services Minister Satsuki Katayama publicly endorsed traditional stock exchanges and market infrastructure on Monday as the primary gateway for blockchain-based assets, rather than allowing the industry to develop as a parallel system.
Speaking at the Tokyo Stock Exchange's opening ceremony for the year, Ms. Katayama identified 2026 as the first year Japan enters a phase of large-scale, comprehensive digitalization. She emphasized that for citizens to benefit from digital and blockchain-based assets, the Vai of exchanges and market infrastructure will be essential, and pledged support for stock exchanges to promote a more advanced, accessible, and efficient market.
Transition from settlement law to securities regulation.
Ms. Katayama's policy direction is built on the foundation of ongoing reforms. On December 10, 2025, the Japan Financial Services Agency outlined a plan to shift the supervision of crypto assets from the Payment Services Law to the Financial Instruments and Transactions Law, treating crypto assets as financial products rather than payment instruments.
Under the new framework, the issuance and trading of cryptocurrencies will fall under the category of securities-type regulations, including stricter disclosure requirements, a ban on insider trading, and expanded enforcement measures against unregistered foreign platforms. This shift reflects a deliberate effort to standardize the integration of cryptocurrencies into the existing financial system rather than establishing a separate regulatory mechanism.
Tax policy is also shifting in the same direction. On December 2, 2025, the Japanese government and its ruling coalition endorsed a plan to apply a fixed tax rate of 20% to profits from cryptocurrency assets. This approach brings cryptocurrency assets closer to stocks and investment funds, while replacing the progressive tax system that could reach up to 55%. The reform is expected to be integrated into a broader package of revisions related to securities law.
The policy direction has been reflected in strict enforcement. On February 7, 2025, regulators ordered Apple and Google to remove apps related to unregistered cryptocurrency exchanges, including Bybit, MEXC , and Kucoin, reaffirming that access for Japanese users would be limited to platforms that comply with local regulations.
Regulatory pressure has reshaped market participation levels. On December 23, 2025, Bybit announced it would begin scaling back services for Japanese residents in 2026 due to regulatory requirements and registration rules. While some players are withdrawing, Japanese regulators are supporting bank-led stablecoin initiatives and exploring frameworks that allow regulated institutions to play a larger Vai in the cryptocurrency market.
Japan's strategy reflects a different management model compared to many countries, choosing to integrate crypto assets into traditional systems rather than creating a separate framework. This approach may offer greater stability but also limits innovation and competition in the digital asset industry in the Japanese market.
