Japan Moves to Ban Crypto Insider Trading with Tough New Penalties
Japan is tightening its regulatory grip on cryptocurrency markets with amendments to securities laws targeting insider trading. The Financial Services Agency will implement a surcharge system tied to profits from illicit crypto trades, while the Securities and Exchange Surveillance Commission gains expanded investigative powers.
The reforms bring digital assets under the Financial Instruments and Exchange Act, closing a loophole that previously exempted cryptocurrencies from insider trading prohibitions. Authorities face unique challenges in defining insiders given the decentralized nature of many blockchain projects.
Market oversight strengthens as adoption grows, with regulators now empowered to recommend penalties and pursue criminal prosecution for severe violations. The changes signal Japan's commitment to legitimizing crypto markets while maintaining investor protections.
