Japan's Upper House Approves Bill to Treat Crypto Assets as Financial Instruments

BlockBeats reports that on July 15, Japan's House of Councillors approved bills to amend the Financial Instruments and Exchange Act and the Payment Services Act, moving crypto assets into the category of financial instruments rather than payment methods. Under the revisions, penalties for unregistered financial activities would be strengthened, with the maximum prison term raised from less than three years to less than 10 years and the maximum fine increased from less than 3 million yen to less than 10 million yen. The package also introduces crypto-asset insider trading rules for the first time, barring transactions based on material nonpublic information. Certain crypto-asset issuers would be required to provide annual periodic disclosures. On taxation, the proposal would replace the current comprehensive tax rate of up to 55% with a separate self-assessed tax rate of about 20%, and allow losses to be carried forward for three years. The tax changes are expected to take effect on January 1, 2028. The amendment would also put in place a regulatory framework intended to facilitate the launch of cryptocurrency ETFs.