Japan’s crypto policy takes a positive step forward

A proposal to allow venture firms to own cryptoassets, first put forward last year, moves closer to law

article-image

Shutterstock / Sean Pavone, modified by Blockworks

share

The Japanese government is advancing an economic reform bill with notable implications for the crypto industry.

A measure included in the proposal would allow investment limited partnerships to acquire and hold cryptoassets. These entities are commonly used for private equity, real estate investments and venture capital investments.

This legislative proposal, published Friday by Japan’s Ministry of Economy, Trade and Industry, now heads to the Diet, Japan’s national legislature.

Broadly, the bill is designed to foster new business creation and strategic domestic investment through tax incentives, and other financial support aimed at specific strategic objectives.

The provision to allow investment firms to directly hold cryptoassets, proposed in September 2023, is seen as a softening of Japan’s relatively stricture regulatory stance when it comes to crypto.

Read more: Japan to let startups raise VC funding via digital assets: Nikkei

The inclusion of crypto assets in the legal framework not only legitimizes their use in institutional investment strategies but also positions Japan as a forward-thinking player in the global digital assets space, said Sota Watanabe, the founder of Astar Network a layer-1 blockchain popular in Japan.

“This is a crucial step for enriching and nurturing the national industry,” Watanabe told Blockworks. “Notably, this issue has long been a risk factor raised by VCs and startups.” 

Read more: Toyota Tests Developer Skills on Popular Japanese Blockchain

By integrating crypto assets into a broader strategy for industrial competitiveness and innovation, Japan’s signals commitment to adapting its regulatory and economic policies to the evolving digital economy.

“Politicians, equipped with accurate knowledge, are moving towards relaxing these regulations,” Watanabe said. “This shift, a result of concerted public-private efforts, represents a victory for all involved.”

The current Diet session runs until June 23, 2024, but legislators can opt to carry over bills, which do not automatically expire as they might in the US Congress at the end of a two-year cycle.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Unlocked by Template (11).png

Research

Union’s technical design brings measured improvements to crosschain interoperability. By combining a consensus-verified hub with novel constructs like state lenses and ZK proofs for client updates, Union achieves an interoperability protocol that is highly performant, trust-minimized, and scalable.

article-image

Camp is looking to onboard licensors and creators to monetize their content for AI agents

article-image

The US regulator will use Nasdaq’s system to detect manipulation across derivatives and prediction markets

by Blockworks /
article-image

SOL and HYPE have rebounded, dYdX course corrects (again)

article-image

Over 100 crypto firms and advocates urge Congress to shield open-source builders and non-custodial providers

by Blockworks /
article-image

The probabilities app is finding mainstream success

article-image

A stock by any other name — even “token” — is still a security