According to a recent report by Nikkei, the Japanese government has approved a bill classifying cryptocurrencies as financial instruments, further legitimizing their status in the country.
The legislation aims to amend the existing Financial Instruments and Exchange Act to provide more protection for investors.
Per the report:
For the first time, it will regulate crypto assets as financial instruments, prohibiting insider trading based on undisclosed information. It will also require cryptocurrency issuers to disclose information once a year, creating a healthy market environment.
It’s important to note that Japan’s FSA (Financial Services Agency) had previously categorized cryptocurrencies under the existing Payment Services Act. It cited their potential use as a means of payment.
With the recent changes, though, misuse of crypto faces severe penalties. For example, the prison sentence for unregistered sellers will be increased from up to three years to up to ten years, while the fines will also be raised to up to 10 million yen from up to 3 million yen.
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