Japan Prepares to Let Banks Hold Cryptocurrencies and Launch Yen-Pegged Stablecoins
Japan‘s Financial Services Agency (FSA) is preparing to examine regulations that may permit banks to purchase and hold Bitcoin and other cryptocurrencies for investment, marking a potential revolution in the financial sector. This would be a shift from the 2020 supervisory guidelines, which prevent banks from holding crypto due to market volatility if approved.
FSA Explores Crypto as a Bankable Asset
The FSA is set to discuss regulatory changes at a Financial Services Council meeting, an advisory body to the Prime Minister of Japan.
Banks are increasingly interested in offering crypto asset management products alongside traditional stocks and government bonds. Authorities are likely to introduce a framework aimed at limiting risks posed by crypto’s extreme price volatility, including capital requirements and enhanced risk management measures before banks gain access to digital assets.
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Banks Could Become Licensed Crypto Exchange Operators
The FSA is reportedly considering whether to allow pooled bank groups to register as licensed cryptocurrency exchange operators, enabling them to provide trading and custody services.
As of February 2025, FSA data indicates there were more than 12 million crypto accounts in Japan, roughly 3.5 times higher than five years ago. Regulators are exploring moving supervision of crypto assets from the Payments Services Act to the Financial Instruments and Exchange Act (FIEA) to strengthen investor protection.
Top Banks to Launch Yen-Pegged Stablecoin
Japan’s major banks—Mitsubishi UFJ Financial Group (MUFG), Sumitomo Mitsui Banking Corporation (SMBC), and Mizuho Bank—plan to jointly issue a yen-pegged stablecoin.
The initiative aims to simplify corporate settlements, reduce transaction costs, and upgrade the overall financial infrastructure.
The move is further strengthened by SSCC and includes new rules to prevent crypto-insider trading.
A New Era for Crypto in Japan
If approved, these proposals would represent a significant shift in Japan’s financial system, linking traditional banking with digital assets. Permitting banks to hold cryptocurrencies and operate licensed exchanges would pave the way for stablecoin issuance, potentially serving as a model for financial institutions and governments globally.
