Summary
- Japan’s Financial Services Agency said it is reviewing revisions to the enforcement order of the Investment Trusts Act to allow crypto ETFs by 2028.
- Japanese financial authorities said they are pushing to cut the top tax rate applied to income related to crypto assets from 55% to a flat 20%.
- Nomura Asset Management and SBI Global Asset Management are reviewing the development of crypto ETF products, and forecasts suggest Japan’s crypto ETF market size could reach about 1 trillion yen.
Reports say Japan is moving to allow crypto exchange-traded funds (ETFs) by 2028, accelerating competition across Asia over crypto regulation. The plan is to fast-track crypto’s integration into mainstream finance in parallel with tax changes and regulatory overhauls.
According to crypto media outlet BeInCrypto on the 26th, Japan’s Financial Services Agency (FSA) is reviewing revisions to the enforcement order of the Investment Trusts Act to permit crypto ETFs, targeting 2028. Discussions include adding crypto as a “designated asset” under investment trusts and allowing ETF trading via ordinary securities accounts after approval by the Tokyo Stock Exchange.
The overhaul also includes adjustments to the tax framework. Japanese financial authorities are seeking to reclassify crypto as subject to the Financial Instruments and Exchange Act and cut the top tax rate on related income from the current 55% to a flat 20%. The move is seen as aligning taxation with that on equities and investment trusts, easing the tax burden that has constrained investment expansion.
Markets are also seeing asset managers position for the regulatory shift. Major firms such as Nomura Asset Management and SBI Global Asset Management are reportedly reviewing the development of crypto ETF products on the assumption of regulatory reforms. Some in the industry project Japan’s crypto ETF market could reach about 1 trillion yen, an estimate based on the growth trajectory of the U.S. spot bitcoin ETF market.
Investor protection measures will be strengthened in parallel. The FSA plans to apply tighter security standards to trust banks responsible for ETF custody, and will require asset managers and securities firms to enhance risk disclosures and operational controls. The steps are viewed as a response to heightened investor-protection needs following a major crypto exchange hacking incident in Japan in 2024.
Across Asia, crypto ETF policies vary by country. Hong Kong is the only Asian market to allow spot crypto ETFs for retail investors, having listed bitcoin and ether ETFs and even a Solana ETF. However, assets under management remain limited compared with the U.S. market.
Taiwan has allowed indirect investment in overseas-listed crypto ETFs, while Singapore continues to take a cautious stance on introducing crypto ETFs for retail investors.
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.
