Japan’s top financial authorities are pushing to tighten rules on cryptocurrency trading, with plans that would make buying or selling tokens on the basis of undisclosed information illegal.
According to Nikkei and other reports, the Financial Services Agency (FSA) is discussing reclassifying some crypto assets under the Financial Instruments and Exchange Act so they carry the same insider-trading rules as stocks and bonds.
Working Group Sets Deadlines
Based on reports, the FSA has laid out a rough timeline for change. Meetings of a government working group on crypto systems have been held this year, and minutes show the agency aims to firm up details by the end of 2025. The plan would then move toward a bill to amend relevant laws as early as 2026.
Japan to ban cryptocurrency insider trading with new rules https://t.co/TaOS9550Pm
— Nikkei Asia (@NikkeiAsia) October 14, 2025
If lawmakers sign off, the Securities And Exchange Surveillance Commission (SESC) would gain new powers to probe suspicious crypto trades, levy penalties tied to illicit gains, and refer serious cases for criminal prosecution.
That shift would let regulators treat certain crypto deals the same way they treat securities trades, including the power to track unusual profit patterns and seek fines.
Japan Moves to Ban Crypto Insider Trading with Upcoming Regulations
The Nikkei detailed plans by Japan’s Financial Services Agency (FSA) to introduce new rules explicitly banning insider trading in cryptocurrencies. This builds on earlier proposals from March 2025 to reclassify…
— MartyParty (@martypartymusic) October 14, 2025
Why Regulators Are Pushing Now
Reports have disclosed that Japan’s crypto user base has grown fast — to about 12.4 million users as of May 2025— which has increased pressure on regulators to protect ordinary investors and the market’s fairness.
At the same time, current rules under the Payment Services Act are seen as weaker when it comes to insider-type abuses.
As of today, the market cap of cryptocurrencies stood at $3.81 trillion. Chart: TradingView
The Challenge Of Tracking Trades
Unlike a company with officers and board members, many tokens aren’t tied to a single, clear issuer. Regulators will have to decide who counts as an “insider” for a given token.
Tracking trades across wallets and proving a trader acted on non-public information are both tough tasks. Blockchain records are public, but linking addresses to people often requires more traditional investigative work.
Experts say regulators will also need clear rules on what information is “material” and how to trace gains from suspect trades before penalties can be imposed.
Featured image from 4K Wallpapers, chart from TradingView
