the regulatory revolution in Japan

Japan is initiating a historic shift in the regulation of Bitcoin and other digital assets, with the prospect of transferring their discipline from the current framework to a more sophisticated system favorable to investors.

This change promises to improve protection and access to the market for institutions and savers.

Japan: the transition of Bitcoin under the financial products law

The Japanese Financial Services Agency (FSA) announced on April 24 the establishment of a working group dedicated to reviewing the regulations governing Bitcoin and digital assets.

The objective is to evaluate the transfer of regulation from the Payment Law to the Financial Products Law (金商法), currently under discussion in the Financial Council scheduled for April 25.

This step is crucial: if Bitcoin is classified as a financial product, a process of substantial regulatory and fiscal change will begin, opening the door to greater legal security and a more regulated market.

From an overall taxation that can reach 55%, it would move towards a separate taxation around 20%, equating Bitcoin to stocks and other securities.

The separate taxation model represents a strong incentive for investors, as it significantly reduces the tax burden compared to the current system.

In addition, the new regulation could favor the introduction of Bitcoin ETFs (Exchange Traded Fund) in Japan, instruments already widespread in other markets that allow easier access to Bitcoin even for traditional investors.

As a result, both investitori istituzionali and privati might increase their exposure to Bitcoin and other digital assets, supporting the growth of the domestic market and the spread of technologies related to Web3.

The Japanese government has included this regulatory evolution within a broader strategic plan, outlined in the “New Capitalism 2025” plan, updated last April 13.

The strategy aims to make Japan a leader in digital innovation, leveraging Web3 technologies and digital assets as key tools for growth and solving social issues.

The promotion of Web3 and the enhancement of local resources

The plan emphasizes the use of technologies such as NFT (non-fungible tokens) to leverage cultural and creative resources, overcoming geographical limitations and expanding access to global markets.

Thus, Japan aims to create a fair and transparent mechanism for the valuation of unique assets, fostering new forms of digital value creation.

Furthermore, the development of a solid regulatory ecosystem should attract new investors and operators, strengthening the countrys competitiveness in the so-called decentralized digital economy.

This Japanese regulatory shift partly reflects a global trend, with particular reference to the United States.

Since January of this year, the Trump administration and administrative bodies in states like Texas have adopted a more open and favorable approach towards Bitcoin and criptovalute.

This greater institutional openness abroad has probably encouraged Tokyo to review its own regulations, aiming not to lose ground in the new digital economies.

Consequently, the Japanese government is preparing for a paradigm shift, from a phase of restrictive rules towards one of exploitation and support of the potential offered by Bitcoin and Web3.

The current legislative initiative is not limited to a technical-regulatory update, but represents a true change in political strategy.

The goal is to transform Japan into an attractive environment for the growth of digital enterprises, while ensuring robust protections for investors.

In this sense, the law on financial products provides more comprehensive mechanisms for protection of investors, increasing transparency and accountability of the exchange platforms.

Prospects for Bitcoin and the Japanese digital market

If the legislative proposal is approved, the Bitcoin market in Japan could enter a very significant expansion phase. Investors could benefit from both more favorable taxation and a clearer and more stable regulatory framework.

Furthermore, the possibility of introducing ETFs on Bitcoin will facilitate access to digital assets for less experienced savers, increasing the liquidity and solidity of the markets.

This could also stimulate the creation of new innovative financial products and services to support digital economic growth.

• Investitore istituzionale: greater interest thanks to clear regulations.
• Private investor: facilitated access and lower taxation.
• Web3 and NFT: enhancement of cultural and creative resources.
• Innovation and protection: balance between technological development and protection.

Ultimately, Japan positions itself at the forefront in redefining regulations for Bitcoin and Web3, aiming to become a benchmark for global digital finance.

The ongoing regulatory transformation represents a unique opportunity for all stakeholders involved: institutions, investors, and businesses.

The challenge now is to seize the benefits of the new legal framework to stimulate sustainable and inclusive growth in the digital sector.

For this reason, closely observing these developments and preparing for change is essential for anyone interested in the world of Bitcoin and digital assets.

Italy and the other countries could draw inspiration from this Eastern experience to refine their regulatory strategies, thus fostering a more robust and innovative digital ecosystem.