Japan Changes Rules for Cryptocurrencies: Spot ETFs Are Closer

Japan has officially equated crypto assets with financial instruments, and now spot ETFs for digital coins have a legal basis for launch. The amendments came into effect on July 15, 2026, and the first such funds in the country are expected no earlier than 2027.

Crypto Assets Included in Traditional Finance

The new regime places cryptocurrencies alongside familiar exchange instruments, including stocks. For investors, this is an important turn regarding taxes:

• Tax rate before changes --- up to 55%.
• Tax rate after changes --- fixed at 20%.

In practice, this could make investments in the cryptocurrency market more understandable for the general audience. Cryptocurrency ceases to appear as a separate niche and gradually integrates into the securities market, where the investor buys not the coin itself, but a regulated product traded on the exchange.

Why Bitcoin Is Considered the First Candidate and What Gives SHIB a Chance

Experts expect that the first funds related to BTC may appear on the Tokyo Stock Exchange. Such a product will provide exposure to Bitcoin; in international terminology, the same asset is often referred to as Bitcoin.

At the same time, SHIB also has significant chances for approval. Its positions in Japan are strengthened by its listing on the largest marketplace Mercari, which has an audience of 23 million users.

In November 2025, the Japan Virtual and Crypto Assets Exchange Association included SHIB in the regulatory "Green List" along with BTC and ETH. The community emphasizes that the path to ETFs begins with regulation:

• The asset must meet the requirements of regulators.
• Only after that does the opportunity to launch an ETF arise.

First, the asset undergoes verification by the rules, and only then does the chance for an ETF appear.

How Such Funds Work

Spot ETF in Simple Terms

A spot ETF is an exchange-traded fund that is tied to the current price of the underlying asset. In cryptocurrencies, this asset becomes the digital coin: the investor buys fund shares through the exchange, rather than storing the coin in a wallet and not working directly with the blockchain infrastructure.

The main difference from a futures ETF is that a spot fund focuses on the asset itself and its current market price. A futures ETF is built around futures contracts --- agreements to buy or sell the asset in the future, so its price can diverge more significantly from the movement of the coin itself.

When comparing ETFs with direct cryptocurrency purchases, the difference lies in control and convenience. A direct purchase gives ownership of the coin and requires self-storage, while a spot ETF simplifies access through a broker but keeps the investor within the exchange product.

What Investors Should Look For

Evaluating the attractiveness of a spot ETF should not be based on the name but on clear criteria: the dynamics of the underlying coin, liquidity, fees, transparency of the structure, and quality of regulation. In the Japanese context, specific candidates currently appear to be products related to BTC, while among other coins, SHIB and Ethereum (ETH) from the regulatory "Green List" attract attention.

• Returns depend on the movement of the underlying coin.
• Liquidity shows how easily fund shares can be bought or sold.
• Fees reduce the final result.
• Regulation and rules for storing the asset affect security.

This format has obvious advantages and risks:

• Advantage: fund shares can be purchased through a regular broker.
• Advantage: the investor does not need to store cryptocurrency in a wallet themselves.
• Risk: the price remains tied to a volatile coin.
• Risk: the launch and circulation of the fund depend on the decisions of regulators and exchange rules.

Approval of spot ETFs could make cryptocurrency more accessible to retail and institutional investors. The easier access to the asset through the exchange, the higher the interest in trading and liquidity, although the price still depends on the movement of the underlying coin.

In analytics surrounding such products, several basic concepts often appear:

• Cryptocurrency --- a digital asset that the fund is oriented towards.
• Data --- indicators of trading, prices, and liquidity.
• Market capitalization --- an estimate of the market size of the asset.
• Forecast --- expectations for future prices.
• Volatility --- the risk of sharp price fluctuations.

Experience from the U.S. also shows that such products require attention from regulators: the market is monitored by the Securities and Exchange Commission, and large financial groups, including Fidelity Investments, create demand for understandable exchange instruments. For Japan, a key condition remains local regulation and the position of financial authorities, including the central bank, in the broad oversight of the financial system.

What Listing Means

Listing refers to the inclusion of a security or digital asset in the list of instruments available for trading on a specific exchange or platform. This procedure confirms that the asset meets the platform's rules and makes it more accessible to a wide range of investors.