The Japanese Senate, also known as the House of Councilors, recently passed a legal amendment that will bring significant changes to the crypto brokerage industry in the country. The amendment, which was approved on June 6, aims to give more freedom to crypto brokerage firms to operate in Japan.
One of the key aspects of the revised Payment Services Act is the creation of a new legal category in the crypto sector called “intermediary businesses.” This new category will have less stringent regulatory barriers compared to traditional crypto exchanges and wallet operators. As a result, brokerages falling under this category will not have to adhere to the same level of regulatory compliance as before.
The amendment was proposed by the Financial Services Agency (FSA) and the government earlier this year and was submitted to the National Diet for approval. After passing through the lower house without major opposition, the bill was finally approved by the House of Councilors. It is expected to be promulgated in June 2026.
Lawmakers believe that the amendment is a response to the rapid growth of digital finance and will help enhance customer protection and promote innovation in the country. The new measures are also expected to lower the barriers for gaming firms looking to enter the web3 and crypto spaces.
In addition to the regulatory changes, the bill also includes provisions to safeguard customer assets in the event of a crypto exchange collapse. The Prime Minister’s office will have the authority to order individual exchange operators to hold a portion of their assets in Japan, a response to the collapse of FTX in 2022. This measure aims to prevent a situation where users are unable to withdraw their funds in case of bankruptcy.
Furthermore, the government will have the power to force crypto operators to issue customer refunds through approved guarantor companies like trust banks in bankruptcy cases. This will prevent overseas operators or subsidiaries from sending their funds overseas if they go bankrupt, ensuring that customer assets are protected.
Overall, the approval of the crypto brokerages reform bill by the Japanese Senate marks a significant step towards creating a more conducive environment for crypto businesses in the country. The new regulations are expected to drive innovation and growth in the crypto industry while also enhancing customer protection.