Bitcoin News Today: Takaichi's Crypto Gambit: Japan Aims to Crown Tokyo as Web3 Capital

Japan's new Prime Minister, Sanae Takaichi, is poised to reshape the country's cryptocurrency landscape through a combination of regulatory refinements and pro-growth economic policies, according to industry experts and policymakers. Elected as the leader of the Liberal Democratic Party (LDP) and set to assume office on October 15, 2025, Takaichi has emphasized technological sovereignty and digital infrastructure development, signaling a potential shift toward a more innovation-friendly regulatory environment for blockchain and crypto assets. Her leadership could consolidate Japan's position as a global hub for Web3 and digital finance, building on its established regulatory framework while addressing gaps in clarity and investor protection.

Japan's crypto regulatory evolution began in earnest after the 2014 collapse of Mt. Gox, which exposed critical weaknesses in oversight. The 2017 Payment Services Act (PSA) established a registration system for exchanges, while subsequent amendments in 2022 and 2023 introduced stablecoin regulations and tax reforms. The Financial Services Agency (FSA) has since proposed reclassifying crypto assets as financial products under the Financial Instruments and Exchange Act (FIEA), a move expected to take effect by 2026. This shift would align crypto taxation with traditional assets, imposing a flat 20% rate on gains instead of the current progressive tax of up to 55%. Such reforms aim to reduce the tax burden on traders, boost market liquidity, and attract institutional investment.

Takaichi's pro-growth agenda, including tax cuts and expansive fiscal spending, has already driven a 4.75% surge in the Nikkei 225 index to a record high of 47,734.04 following her election. Analysts suggest her monetary easing stance could sustain investor appetite for alternative assets like cryptocurrencies, particularly as the yen weakens. The FSA's recent proposal to allow loss carryforwards for up to three years further underscores efforts to stabilize the market. These measures align with Takaichi's broader economic strategy to end deflation and stimulate domestic demand, which could indirectly benefit crypto adoption.

Japan's regulatory clarity has already yielded results. According to Chainalysis, Japan's on-chain value received grew by 120% year-on-year through June 2025, outpacing neighboring markets like Indonesia and South Korea. The country's first yen-pegged stablecoin, JPYC, is expected to launch by year-end, backed by domestic deposits and government bonds. Institutional interest is also rising: Tokyo-based firm Ureru Net Ad Group plans to launch a Bitcoin recovery subsidiary, Bitcoin Savior Co., addressing the estimated 3.7 million inaccessible crypto assets globally. Meanwhile, exchanges like BitMEX are expanding operations in Tokyo, citing the city's institutional-grade infrastructure and regulatory predictability.

Takaichi's election has also clarified the legal status of crypto donations to politicians, confirming their permissibility under Japan's campaign finance laws. While she has not explicitly outlined a crypto policy, her past advocacy for "technological sovereignty" and collaboration with opposition parties on tax reforms suggests a pragmatic approach. The Democratic Party for the People, a coalition partner, has historically supported crypto tax overhauls, increasing the likelihood of legislative progress. However, challenges remain: aggressive fiscal spending could pressure the Bank of Japan to tighten monetary policy, creating headwinds for risk assets like crypto.

Global market dynamics further complicate the outlook. Takaichi's upcoming meeting with U.S. President Donald Trump in October 2025 could influence Japan's stance on Bitcoin reserves or deregulation, though her conservative leanings may temper alignment with U.S. initiatives. Domestically, Finance Minister Katsunobu Kato's retention and Digital Minister Masaki Taira's silence on crypto specifics highlight uncertainties in policy execution. Nonetheless, Japan's regulatory framework-rooted in strict custody rules, AML compliance, and investor protections-positions it as a preferred destination for crypto firms over Singapore and Hong Kong, which face tighter compliance costs.

The FSA's proposed reclassification of crypto as financial products under FIEA is a pivotal step. It would enable the approval of crypto ETFs and standardize trading oversight, aligning Japan with markets like the U.S. and Hong Kong. This move, coupled with a flat 20% tax rate, could attract global capital and institutional participation, fostering a more liquid and mature market. However, the FSA's 2026 timeline for implementation means immediate benefits may be limited, with the sector relying on existing frameworks until reforms take effect.

Japan's crypto adoption rate, currently at 14.70% in 2025, is projected to rise to 15.26% by 2026, with user numbers expected to reach 18.69 million. The government's goal of a 40% cashless economy by 2025 further underscores its commitment to digital infrastructure. As Takaichi's administration navigates these developments, the interplay between regulatory clarity, fiscal policy, and global macroeconomic trends will determine Japan's trajectory as a crypto leader.

Source: [1] Cointelegraph (https://cointelegraph.com/news/japan-pm-boost-crypto-economy-refine-blockchain-regulations)

[2] Coinpedia (https://coinpedia.org/cryptocurrency-regulation/crypto-regulations-in-japan/)

[3] BeInCrypto (https://beincrypto.com/japans-iron-lady-sanae-takaichi-may-reshape-crypto-policy/)

[4] Blockchain.News (https://blockchain.news/flashnews/sanae-takaichi-confirms-crypto-donations-to-politicians-are-legal-in-japan-trading-impact-on-bitcoin-btc-and-market-sentiment-in-2025)

[5] Cryptotale (https://cryptotale.org/cryptocurrency-regulation-in-asia-2025-policies-overview/)

[6] Coindesk (https://www.coindesk.com/markets/2025/10/07/asia-morning-briefing-regional-crypto-power-balance-is-shifting-as-japan-ready-to-pop)

[7] NewsOnJapan (https://newsonjapan.com/article/146881.php)

[8] CoinCentral (https://coincentral.com/pro-growth-pm-takaichi-ignites-japan-stock-crypto-market-rally/)

[9] Coininsider (https://www.coininsider.com/news/2025/10/japans-new-pm-boosts-optimism-for-markets-and-crypto/)

[10] Bitget (https://www.bitget.com/wiki/nikkei-225-stock-index)