Japan’s Financial Services Agency is working on new rules that would force crypto exchanges to keep emergency reserves in case something goes wrong, like a hack or exploit. Right now exchanges have to store customer crypto in cold wallets, but there’s no requirement for them to have backup funds ready to compensate users if things go sideways.
The FSA wants to change that by making it legally mandatory for exchanges to maintain liability reserves. They’re planning to submit this bill to parliament sometime in 2026, according to Nikkei Asia.
This move makes sense considering what happened last year when DMM Bitcoin got hacked and lost around $312 million. The hackers got in through Ginco, which is a software company that DMM had outsourced their trading management to.
Beyond just protecting investors, Japan has been making tons of changes to crypto regulations lately. They’re thinking about reclassifying cryptocurrencies under different financial laws and potentially lowering the tax on crypto gains to a flat 20%, which would match how stocks and bonds are taxed.
The country is also backing a yen stablecoin project involving three major banks, showing they’re serious about integrating digital assets into the financial system. Some of Japan’s biggest wealth managers are even preparing to launch the country’s first crypto investment trusts.
Conclusion
Japan plans laws forcing exchanges to hold liability reserves after the DMM hack; it is also reconsidering crypto classification, cutting taxes, and backing a yen stablecoin and investment trusts.
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