Catenaa, Wednesday, October 22, 2025-Japan’s Financial Services Agency is reportedly considering lifting restrictions that currently prevent domestic banks from trading and holding cryptocurrencies, in what could mark a significant policy shift for the country’s financial sector.
According to local reports from Yomiuri Shimbun, the FSA plans to discuss the reforms at an upcoming meeting of the Financial Services Council, an advisory body to the Prime Minister.
The discussions will center on revising supervisory guidelines that ban banks from owning digital assets due to their price volatility.
The proposed framework would allow Japanese banks to buy and sell cryptocurrencies similarly to how they handle government bonds or equities.
Officials are expected to design strict risk-management and compliance safeguards to prevent systemic exposure, ensuring consumer protection amid the reform.
The agency is also considering allowing banks to register as licensed crypto exchanges, which would give retail investors access to digital assets through regulated banking institutions. Analysts say such a move could boost market participation while increasing oversight.
Separately, the FSA is reportedly working on legislative amendments to prohibit insider trading in digital assets, with penalties tied to profits gained from non-public information.
The initiative is part of Japan’s broader effort to strengthen transparency and integrity in its crypto markets.
