The Japanese financial regulator is considering to allow banks to purchase and hold digital currencies such as Bitcoin for investment.
Per a report by Yomiuri, the Financial Services Agency (FSA) will present the proposal at a working group meeting of the Financial Services Council. Further, the reform aims to align crypto management with traditional financial products, including stocks and government bonds. Additional regulations to ensure stability is under consideration, the report read.
“By allowing highly credible bank groups to participate, the FSA will create an environment that makes it easier for individual investors to invest,” the report translated. As of February 2025, the country saw over 12 million crypto accounts registered, a 3.5x times increase compared to five years ago.
The watchdog further noted that it would allow bank groups to register as “cryptocurrency exchange operators,” allowing them to offer trading and exchange services.
As a result, the nation has been embracing crypto in many ways, including launching first yen-backed stablecoin. The FSA said that it would approve issuance of the stablecoin this month. The token aims at uses ranging from international remittances to corporate settlements.
Japan has been struggling with escalating national debt, now nearing a staggering 240% of its GDP. The exceptionally high debt could prompt high inflation and other financial repression measures.
