Regulation — Japan & the World

FSA oversight, the FIEA migration, U.S. FIT21 & CLARITY, EU MiCA, and the Strategic Bitcoin Reserve. Taxes are covered in the dedicated Bitcoin Taxes topic.

5 min readLast updated: August 15, 2026

Key points

This topic surveys Japan's FSA licensing and stablecoin rules, the Travel Rule, the U.S. FIT21/CLARITY Act and Strategic Bitcoin Reserve, and the EU's MiCA regulation. In 2026 Japan enacted laws moving crypto assets under the Financial Instruments and Exchange Act and toward separate-declaration taxation, showing regulation and tax reform advancing together (taxes are covered in the dedicated Bitcoin Taxes topic).

The Financial Services Agency (FSA) & Registration System

Taxes, gain/loss calculation, and filing are covered in the dedicated Bitcoin Taxes topic; this topic focuses on the regulatory framework itself.
Japan was among the first countries globally to establish a licensing regime for crypto exchanges (April 2017 Payment Services Act amendment).
Operating a crypto exchange in Japan requires FSA registration as a "Crypto Asset Exchange Service Provider." Operating unregistered carries up to 5 years imprisonment or ¥5M fine.
Major registered exchanges (as of 2026): bitFlyer, Coincheck (Monex Group), GMO Coin, bitbank, SBI VC Trade, Rakuten Wallet, and others (DMM Bitcoin wound down after a 2024 hack; its accounts and assets were transferred to SBI VC Trade).
The Cabinet Office Ordinance and FSA Administrative Guidelines stipulate detailed operational rules: customer-asset segregation, minimum cold-wallet holdings, hot-wallet limits, AML/CFT frameworks, etc.
After the 2018 Coincheck NEM hack (~$530M stolen), Japan tightened rules — mandating ≥95% cold-storage holding, among other reforms.

Stablecoin Regulation (Amended Payment Services Act)

The Payment Services Act amendment passed in June 2022 and took effect in June 2023. Japan was the first G7 country to adopt a comprehensive stablecoin framework.
Electronic Payment Instrument (stablecoin) issuers are restricted to banks, money-transfer operators, or trust companies — designed to prioritize user protection.
Issuers must back 100% of issued value with reserves; in case of issuer failure, users receive priority repayment.
Stablecoins and related infrastructure in Japan: JPYC (a yen-denominated stablecoin issued by JPYC Inc., a registered funds-transfer operator, launched October 2025), JPYSC (Japan's first trust-type yen stablecoin, issued by SBI Shinsei Trust Bank, launched June 2026), and USDC (a US-dollar stablecoin issued by Circle; domestic trading began March 2025). Progmat Coin is not a coin brand but a stablecoin issuance/management platform operated by Progmat, Inc. (backed by MUFG Trust Bank and others).
Domestic USDC trading began in March 2025; as of June 2026, SBI VC Trade is the only registered electronic payment instruments service provider in Japan. JPY ↔ USDC ↔ USD bridge-style payments are emerging as practical.

Travel Rule

Based on FATF recommendations, the "Travel Rule" requires crypto exchanges to exchange originator and beneficiary information for transactions above a threshold.
Japan began enforcement in June 2023: for transfers over ¥100,000 (~$660), the sending and receiving exchanges must exchange name, address, and account info.
Multiple protocols coexist: TRP (Travel Rule Protocol), Sygna Bridge, TRUST (Coinbase-led). Interoperability between exchanges remains a work in progress.
Transfers to self-custody wallets (e.g., MetaMask, personal wallets) require the user to pre-submit recipient address info to the exchange.
A controversial rule from a privacy standpoint, but aligned with the emerging international AML standard.

U.S. FIT21 / CLARITY Act

May 2024: FIT21 (Financial Innovation and Technology for the 21st Century Act) passed the U.S. House with bipartisan support (279 to 136).
FIT21 core: clear categorization of crypto assets as either "commodity" or "security." Bitcoin is unambiguously classified as a commodity under CFTC jurisdiction.
The bill clarifies the SEC/CFTC jurisdictional split — moving away from the Gensler-era "regulation by enforcement" approach toward explicit rule-making.
After the 2025 administration change, the successor "CLARITY Act" (H.R.3633) passed the House in July 2025. As of 2026 it remains under Senate consideration, with no floor vote yet.
In parallel, the "GENIUS Act" (comprehensive stablecoin regulation) passed in 2025, establishing a U.S. dollar-denominated stablecoin framework.

The U.S. Strategic Bitcoin Reserve (2025)

March 6, 2025: President Trump signed Executive Order 14233, establishing the Strategic Bitcoin Reserve.
Initial assets: approximately 200,000 BTC held by the federal government through criminal forfeiture became the reserve's seed holdings — one of the largest holdings globally.
"Budget-neutral strategy" policy: further acquisitions should not burden taxpayers; options under consideration include tariff revenue and revaluation of special drawing rights.
A parallel "Digital Asset Stockpile" was also established. Other crypto (e.g., ETH) is held as stockpile, but generally subject to sale. Bitcoin alone is the protected "no-sale" sanctuary.
Following the federal move, states (Texas, New Hampshire, Arizona, etc.) have passed their own Bitcoin reserve laws.

EU MiCA Regulation

May 2023: The EU Council formally adopted MiCA (Markets in Crypto-Assets Regulation). Full enforcement began in phases from June 2024.
MiCA provides a unified regulatory framework across all 27 EU member states, eliminating previous member-level inconsistencies.
CASP (Crypto-Asset Service Provider) licensing: register in one member state, passport across the entire EU.
Stablecoin regulation: strict requirements on "significant" non-euro stablecoins (e.g., USDT), leading to USDT delistings on some EU exchanges.
Transparency requirements: "white paper" filing at issuance, market-manipulation prohibition, insider-trading rules — close to a securities-style regime.

Global Landscape

UK: FCA (Financial Conduct Authority) registration regime. In 2024, crypto assets were formally recognized as "regulated financial products."
Singapore: MAS DPT (Digital Payment Token) service licensing. Positioned as an Asian crypto hub with institution-focused rules.
China: Comprehensive ban on trading and mining since September 2021. However, individual BTC holding itself is not banned; courts have recognized BTC as property.
India: 30% crypto tax (from April 2022) + 1% TDS (tax deducted at source) — effectively a suppressive regime.
South Korea: The 2024 "Virtual Asset User Protection Act" established strict exchange oversight.

Future Regulatory Outlook

Japan: the move to a flat separate-declaration tax (20.315%) has taken concrete shape via the 2025 tax-reform outline and the FIEA amendment enacted in July 2026 (the new regime is expected to apply from 2028). Crypto's reclassification as financial instruments and the tax reform are advancing together.
U.S.: CLARITY Act expected to finalize the SEC/CFTC jurisdictional split. State-level Bitcoin reserves are expanding.
Stablecoin competition: expect heightened contention between sovereign CBDCs and private stablecoins.
Travel Rule harmonization: FATF is pushing cross-border protocol compatibility as a priority.
Long-term: focus may shift from "crypto-asset regulation" toward "decentralized financial infrastructure regulation" — with protocol developers' legal responsibilities becoming central to the debate.