Japan's Financial Services Agency (FSA) has proposed a plan that changes the status of cryptocurrencies under the Financial Instruments and Exchange Act, which could transform the country's digital asset market.
New Classification of Cryptocurrencies in Japan
Introduced on June 24, the proposal seeks to align crypto assets with traditional securities and investment products. This could lead to the launch of crypto exchange-traded funds (ETFs) in Japan.
Changes in Tax Regulation
The FSA also aims to introduce a flat 20% tax rate on crypto income, replacing the current progressive system where gains are taxed as high as 55%.
Parallels with International Markets
Japan seeks to align with global trends where interest in cryptocurrencies as viable investment assets is rising. As of now, there are over 12 million active crypto accounts in the country, with holdings exceeding 5 trillion yen.
The reclassification of cryptocurrencies in Japan may promote growth in the digital asset market and attract new investors, aligning with global trends in institutional investment.
