Woofun AI reports that Japan’s Upper House passed the "Partial Amendment to the Financial Instruments and Exchange Act and the Capital Settlement Act" on July 15, officially reclassifying crypto assets from payment methods to financial instruments. The legislation mandates renaming crypto asset exchanges to "crypto asset trading firms" and introduces a regulatory framework prohibiting insider trading involving undisclosed material information. Specific issuers must submit annual disclosures, while penalties for unregistered sales increase to under 10 years imprisonment and fines up to 10 million yen.

The amendments replace the previous 55% comprehensive tax rate with a separate reporting-based system at approximately 20%, allowing loss carry-forwards for up to three years. These regulatory changes are scheduled to take effect on January 1, 2028.