Japan plans to reclassify cryptocurrencies and implement major tax cuts

Japan’s Financial Services Agency (FSA) is finalizing a major reform plan to reclassify 105 cryptocurrencies, including bitcoin and ether, as financial product groups. The agency is also proposing to reduce the income tax on cryptocurrency trading from a maximum of 55% to 20%, equivalent to the tax rate applied to securities. Under the new regulations, exchanges will be required to disclose detailed information about each asset, such as issuer, underlying blockchain, and price volatility.

The FSA is also considering measures to prevent insider trading, including restricting executives and issuers from trading based on non-public information. The reform package is expected to be submitted to the 2026 parliamentary session, along with tax adjustments in the next fiscal year. These changes aim to increase transparency, strengthen market integrity, and position Japan as a regional hub for crypto innovation.