According to the document, Japan will continue to focus on traditional fiat currencies such as the US dollar and euro to manage its foreign reserves.
Japanese flags in stores across the country. Photo: Colton Jones.
The Japanese government has ruled out the possibility of adopting Bitcoin reserves, clarifying its position on the matter following questions from House of Councillors member Satoshi Hamada.
The response, issued on behalf of Prime Minister Shigeru Ishiba, made it clear that the government does not consider incorporating digital assets into its reserve strategy.
According to the document, Japan will continue to focus on traditional fiat currencies such as the US dollar and euro to manage its foreign reserves.
“Bitcoin is very volatile”
The government said the Special Fund for Foreign Exchange, regulated by Article 20 of the Foreign Exchange and Foreign Trade Control Law, is designed exclusively for operations involving conventional foreign currencies such as the US dollar and the euro.
The inclusion of Bitcoin or other cryptocurrencies as strategic reserve assets does not align with the objectives established by current legislation.
The government explained that while countries like the United States explore different approaches to using cryptocurrencies, Japan will maintain its focus on financial stability and economic security by prioritizing traditional assets in its official reserves.
Such a decision shows Japan's caution regarding the volatility and regulatory uncertainty that still surrounds the cryptocurrency market, even in the face of its growing global adoption.
While Bitcoin has established itself as a store of value in some jurisdictions, Japan has taken a conservative approach, stressing the need for ongoing assessments before any move in that direction.
“The Japanese government’s position reaffirms its commitment to fiscal and economic prudence while closely observing international trends and policy developments related to digital assets,” the document says.