Japan’s Financial Services Agency (FSA) has proposed reclassifying cryptocurrencies as financial products, bringing digital assets under the same regulatory framework as traditional financial instruments.

The plan introduces stricter disclosure and insider-trading rules for crypto platforms and cuts the proposed tax rate on crypto gains from around 55% to a flat 20%, aiming to increase transparency and investor protection.

If adopted, the changes could boost mainstream adoption and institutional interest in crypto while imposing heavier compliance requirements on exchanges and businesses operating in Japan.