Japan FSA Considers Allowing Banks to Hold and Trade Cryptocurrency, Plans Banks as Crypto Exchanges and Regulatory Reforms

The Japanese Financial Services Agency is weighing reforms that would allow domestic banks to hold and transact in digital assets, easing current restrictions driven by price volatility. The initiative aims to align crypto activity with conventional asset classes.

Supporters say the policy reform would enable banks to buy and sell cryptocurrency like stocks and government bonds, under a new regulatory framework designed to curb risks and strengthen supervisory controls.

Officials also consider banks registering as cryptocurrency exchanges, potentially expanding retail access through trusted banking channels. At the same time, amendments would prohibit trading on non‑public information, with economic penalties tied to illicit gains.

Deliberations are expected at an upcoming Financial System Council session, reflecting a broader push to modernize Japan’s crypto market while preserving market integrity and prudent risk management.

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