The post This Change in Japan’s Crypto Tax Will Have Big Implications for Bitcoin and Ethereum appeared first on Coinpedia Fintech News

Japan is moving closer to fixing one of crypto’s biggest pain points in the country – taxes. But the details show the change won’t apply to everyone.

Under its 2026 tax reform blueprint, Japan plans to cut crypto capital gains tax from as high as 55% to a flat 20%. The move would put certain digital assets on the same footing as stocks and investment trusts, a long-standing demand from investors and industry groups.

The reform isn’t new but what’s clearer now is how limited its scope will be.

Only ‘Specified’ Crypto Assets Will Qualify

The lower tax rate will apply only to “specified crypto assets” handled by businesses registered under Japan’s Financial Instruments and Exchange Act (FIEA).

Around 105 cryptocurrencies currently listed on registered exchanges are expected to fall under this category, with major assets like Bitcoin and Ethereum likely included.

Assets outside this framework will not benefit. The blueprint does not clearly include NFTs, and income from staking or lending remains a grey area under the current proposal.

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Bringing Crypto Closer to Stocks

Another notable change is the introduction of a three-year loss carry-forward for qualifying crypto trades. This allows investors to offset future gains with past losses, a rule already standard for stocks and FX trading in Japan.

However, losses from crypto trades will remain ring-fenced and cannot be used to offset gains from other asset classes.

ETFs and Institutional Access in Focus

The tax reform also supports Japan’s broader push to integrate crypto into traditional finance. Investment trusts holding crypto would be allowed, and the country has already launched its first XRP exchange-traded fund.

Final rules will depend on legislation passed by the Diet ahead of fiscal year 2026. For now, Japan’s direction is clear: crypto is being welcomed but only within a tightly regulated framework.

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FAQs

Is Japan reducing crypto taxes?

Yes. In 2026, Japan plans to lower crypto capital gains tax to a flat 20% for qualifying assets, down from rates as high as 55%.

Which cryptocurrencies qualify for Japan’s lower tax rate?

Only “specified crypto assets” (like Bitcoin) on registered Japanese exchanges qualify. NFTs and staking income may not be included under the current proposal.

How does Japan’s crypto tax compare to stocks?

From 2026, eligible crypto will be taxed at a flat 20%, aligning with stocks. Both will also allow a 3-year loss carry-forward rule for calculating gains.

When does Japan’s new crypto tax rule start?

The proposed flat 20% tax rate is part of the 2026 tax reform blueprint. Final rules depend on legislation passed by Japan’s Diet ahead of that fiscal year.