Japan Creates Dedicated Crypto Division Amid Regulatory Overhaul

Japan's Financial Services Agency (FSA) is expanding its oversight of cryptocurrencies and stablecoins by launching a new division, which will be responsible for supervising digital asset activities. The Crypto-Assets and Stablecoins Division will sit within the newly created Asset Management and Insurance Supervision Bureau.

The division combines the functions of several smaller offices, including the Crypto-Asset Monitoring Office, Innovation Promotion Office, and Digital Payments Planning Office. This reorganisation aims to improve coordination across crypto supervision, stablecoin policy, digital payments, and financial innovation.

The move comes as Japan's parliament has approved amendments to the Financial Instruments and Exchange Act and the Payment Services Act, which will treat crypto-assets as a distinct category rather than as securities. The reforms introduce disclosure requirements for certain crypto-assets, statutory restrictions on insider trading, expanded investigative powers, and stronger penalties for unregistered operators.