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Japan’s FSA May Let Banks Hold Bitcoin and Other Cryptocurrencies

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Japan’s Financial Services Agency (FSA) is reportedly preparing to review regulations that could allow banks to acquire and hold cryptocurrencies like Bitcoin for investment purposes.

The move will mark a major policy shift, as current regulatory guidelines, revised in 2020, effectively bar banks from holding crypto due to volatility risks, according to a Sunday report from LiveDoor News.

Per the report, the FSA plans to discuss the reform at an upcoming meeting of the Financial Services Council, an advisory body to the prime minister. The initiative aims to align crypto asset management with traditional financial products such as stocks and government bonds.

Regulators are expected to explore a framework for managing crypto-related risks, such as sharp price swings that can affect a bank’s financial health. If approved, the FSA will likely impose capital and risk management requirements before banks are allowed to hold digital assets.

Japan may let banks run licensed crypto exchanges

The FSA is also considering allowing banking groups to register as licensed “cryptocurrency exchange operators,” enabling them to offer trading and custody services directly.

Japan’s crypto market continues to grow rapidly, with more than 12 million crypto accounts registered in February 2025, about 3.5 times higher than five years ago, according to FSA data.

At the beginning of September, the FSA seeks to put crypto regulation in place Under the Financial Instruments and Exchange Act (FIEA), its transfer from the Payment Services Act to strengthen investor protection and align cryptos with securities laws.

The regulator said many issues within crypto resemble those traditionally addressed under the FIEA, so it may be appropriate to apply similar mechanisms and enforcement.

Japan’s top banks to launch yen-pegged stablecoin

Three of Japan’s largest banks, including Mitsubishi UFJ Financial Group (MUFG), Sumitomo Mitsui Banking Corp. (SMBC) and Mizuho Bank, have joined forces in Issue a yen-pegged stableCoin aimed at streamlining corporate arrangements and reducing transaction costs.