The Financial Services Agency of Japan (FSA) has announced plans to reclassify cryptocurrencies, such as Bitcoin, as "regulated financial assets." This change is proposed in the agency's tax reform request for the fiscal year 2025, with the aim of recognizing crypto assets as investments accessible to the general public.
Currently, cryptocurrencies are classified as "payment instruments" under Japan's Payment Services Act. However, the proposed change would signify a step towards the legitimization of cryptocurrencies, depending on the stability of the industry.
According to CoinPost, this development could lead to a review of the controversial tax rules on cryptocurrencies in Japan. The Liberal Democratic Party (LDP) of Japan has also proposed a similar initiative in its fiscal policy recommendations for the fiscal year 2025.
The LDP's proposal seeks to integrate the cryptocurrency sector into regulations related to accountability and investor protection, similar to those governing publicly traded stocks. This would allow certain crypto assets to be treated as "financial products" commonly used in public investment portfolios.
This development is an important step towards the regulation and legitimization of cryptocurrencies in Japan. However, it is important to note that the regulation of cryptocurrencies is a complex and constantly evolving issue.
