Japan’s FSA Weighs Crypto Banking, With Safeguards, in Major Policy Review

A major review of Japan’s financial regulations is underway, with the Financial Services Agency (FSA) considering a carefully calibrated move to permit local banks to engage in cryptocurrency activities.

The agency plans to discuss reforming the supervisory guidelines that currently bar banks from holding volatile digital assets.

The reported goal is to establish a tightly-controlled system where banks can transact in crypto, but only within a new framework of “regulatory guardrails” designed to mitigate financial risk.

This cautious approach is part of a dual strategy that also involves strengthening market fairness through proposed laws against insider trading, ensuring any expansion into crypto is both secure and well-regulated.