Japan’s Financial Regulator Unveils Dual Measures for Crypto Innovation and Oversight

Japan's Financial Services Agency (FSA) announced dual measures to foster crypto innovation while enhancing oversight. The first measure is the Payment Innovation Project (PIP), a proof-of-concept trial involving major banks like Mizuho and Mitsubishi UFJ to test the legal and efficient issuance of stablecoins using blockchain technology. The FSA will publish the results regarding compliance and legal interpretations after the PoC concludes. Concurrently, the FSA is proposing stricter regulations for crypto lending and Initial Exchange Offerings (IEOs). Proposals include bringing crypto lending services under the Financial Instruments and Exchange Act, requiring risk management frameworks, secure custody, and clear disclosures, particularly targeting high-yield products with long lock-up periods. Regulators also discussed imposing investment caps on IEOs to prevent excessive fundraising without audits, signaling Japan's balanced approach to digital asset development.

(Source：BeInCrypto)