Japan is expected to recognize cryptocurrencies as financial assets.

This development follows the approval of a bill by Japan’s Cabinet that will reclassify 105 major cryptocurrencies, including Bitcoin and Ethereum, under the Financial Instruments and Exchange Act (FIEA), News.Az reports, citing Kucoin.

The legislation, passed in April 2026, aims to enhance regulatory oversight, with measures such as annual disclosures for issuers, and increased penalties for non-compliance.

The shift is expected to be fully implemented by fiscal year 2027, potentially reducing capital gains taxes on qualifying assets. Markets appear to interpret this move as a significant step towards aligning…