Japan is moving closer to establishing its first Bitcoin ETF, which could become available as early as 2028 once proposed regulatory reforms are fully implemented.

According to a recent Nikkei report, Japan's parliament has passed a legal amendment bringing cryptocurrencies under the jurisdiction of the Financial Instruments and Exchange Act. This shift moves regulatory oversight of digital assets away from the Payment Services Act—the framework that had treated crypto primarily as a means of payment—and paves the way for investment trusts and exchange-traded funds to hold cryptocurrencies. Reclassifying digital assets under the same legislation that governs traditional securities marks a fundamental legal change, aligning crypto oversight more closely with how Japan regulates stocks, bonds, and other conventional financial instruments.

A New Investment Market

Japan has not yet approved any Bitcoin ETF. However, the recent legislation is widely regarded as a critical milestone toward making such a product possible. Before any fund can launch, regulators must complete additional rule amendments to formally legalize investment funds holding cryptocurrencies.

Market predictions suggest that Japanese Bitcoin ETFs could attract investments of up to JPY 3 trillion by fiscal 2028. Major financial institutions including SBI Holdings and Nomura are reportedly developing cryptocurrency-based investment products. The involvement of these established firms signals growing mainstream financial-sector interest in offering regulated crypto exposure to clients.

The development has sparked discussion within the crypto community. Some observers have characterized it as a significant policy reversal from Japan's conservative stance following the Mt. Gox collapse, which saw roughly 850,000 BTC lost and led Japanese authorities to adopt a cautious regulatory posture toward digital assets for years. If approved, the move would provide both retail and institutional investors with access to Bitcoin through a regulated ETF.

Japan's first spot Bitcoin ETF could land in 2028. Three years away. Not a headline that moves $BTC today at $65k. But for a country that spent a decade treating crypto like a toxic spill after Mt. Gox, this is a quiet policy U-turn. The crowd still measures progress by US ETF… pic.twitter.com/yh5HeyhlDC — Macro Alpha (@MacroAlphaHQ) July 23, 2026

Stricter Crypto Regulations

Alongside ETF plans, Japan is also tightening its overall crypto regulatory framework. Under the amended bill, the prison sentence for operating an unauthorized cryptocurrency business has been increased from three years to up to ten years. Fines have also been raised from 3 million yen (approximately $18,500) to 10 million yen.

The new regulatory system additionally introduces expanded disclosure requirements and insider trading rules for crypto operations. The simultaneous expansion of access and enforcement reflects a regulatory philosophy that treats crypto as a maturing asset class requiring investor protections comparable to those in traditional securities markets.

Growing Corporate Adoption of Digital Assets

The push for clearer regulation comes as an increasing number of Japanese firms are adding digital assets to their balance sheets. Recently, SBI VC Trade noted that corporations are holding not only Bitcoin but also XRP in their company treasuries, driven in part by a depreciating yen that has weakened against major currencies. The exchange also reported increased use of cryptocurrency in share award programs.

Japan remains a strong market for XRP, supported by SBI's longstanding partnership with Ripple in cross-border payments. Following regulatory clearance, SBI launched its own version of RLUSD, the stablecoin issued by Ripple, and has also filed for an XRP ETF in Japan. SBI's pursuit of both Bitcoin and XRP-based ETF products positions Japan as one of the few markets globally where altcoin-tied ETF applications are advancing alongside Bitcoin products—offering a signal of which crypto assets Japanese regulators and institutions may be prepared to treat as investable.