Japan passes the crypto law traders wanted but its 20% tax could still wait until 2028
Japan’s Diet has passed legislation moving regulated crypto activity from the Payment Services Act into the Financial Instruments and Exchange Act. Crypto stays legally distinct from securities, but regulated activity will face a securities-style framework covering disclosure, registration, issuer-controlled token offerings, custody, customer protection, asset screening, and insider-trading controls. The new rules are enacted but not yet live. The Cabinet will set the start date within one year of promulgation, and that timing determines when the related 20% crypto tax regime begins: if enforcement starts in 2026, the tax rules begin Jan. 1, 2027; if it starts in 2027, they begin Jan. 1, 2028. The 20% rate applies only to eligible tokens sold through registered crypto businesses and listed on Japan’s official register, with losses carryable forward for three years under conditions. Reporting to tax authorities would start a year later. The package also opens a possible path for crypto investment products, but no spot Bitcoin ETF is approved yet.
