22
Japan’s Financial Services Agency (FSA) plans to formally reclassify Ripple’s XRP token as a “regulated financial product” before the second quarter of 2026.
This step means that XRP will be removed from its current “crypto asset” status under the Payment Services Act and placed under the stricter Financial Instruments and Exchange Act (FIEA).
Officials state that the primary purpose of this change is to resolve the discrepancy between XRP’s actual use in Japan and its legal status.
XRP already plays a key role in the country’s banking and international money transfer infrastructure and is actively used by many financial institutions. The new classification aims to make XRP’s legal status more suitable for large-scale institutional adoption in Japan.
Following the reclassification, XRP will gain “investment grade” status as a financial instrument, similar to traditional stocks and bonds. This is expected to encourage new capital inflows into XRP, particularly by increasing interest from institutional investors. It is also suggested that this step could set a precedent for other major digital assets.
Under the new regulations, exchanges and liquidity providers will be required to provide more comprehensive disclosures about the asset’s volatility, technical characteristics, and relationship with the issuer. In addition, insider trading and market manipulation are explicitly prohibited, aiming to strengthen investor protection.
Experts say that Japan’s move could be a significant milestone in creating a clearer and more predictable regulatory framework for cryptocurrency markets.
*This is not investment advice.
coingape.com
cryptopolitan.com
en.cryptonomist.ch
cointelegraph.com