Japanese Investors Push for 20% Tax on Crypto Earnings

• Japan’s FSA is considering a unified 20% tax rate for cryptocurrency transactions to encourage market growth.
• Japanese firms like Metaplanet are increasing Bitcoin investments, viewing it as a hedge against inflation.

Japan’s financial landscape is changing dramatically, as the Financial Services Agency (FSA) releases new tax reform criteria for fiscal year 2025, focusing for the first time on virtual currency transactions.

This action marks a watershed moment in Japan’s approach to cryptocurrency taxation, which has long been a source of concern for investors.

The Japanese Financial Services Agency issued tax reform requirements for fiscal year 2025, specifically mentioning the tax treatment of virtual currency transactions for the first time. Many investors have called for the current maximum tax rate of 55% for cryptocurrencies to be…

— Wu Blockchain (@WuBlockchain) September 2, 2024

Investors Push for Tax Reform Amid Japan Growing Crypto Involvement 

Currently, the maximum tax rate on crypto revenues in Japan might be up to 55%. This high tax rate has been blamed for limiting investment in the booming bitcoin business. In response, several investors are lobbying for a more favorable tax system, notably a 20% single tax rate.

This amendment will put crypto taxes in line with the tax treatment of traditional financial products such as stocks. The proposed tax reform comes at a time when Japan’s involvement with cryptocurrency is growing.

According to CNF, Ripple, a prominent cryptocurrency firm, has collaborated with over 50 Japanese institutions to create a new payment infrastructure using distributed ledger technology. This agreement demonstrates Japan’s growing institutional interest in blockchain and digital assets.

In addition to institutional advancements, private enterprises in Japan are boosting their crypto investments. Metaplanet, a well-known Japanese public business, has announced plans to raise $60 million in share sales to increase its Bitcoin (BTC) holdings to $70 million.

The company views bitcoin as a long-term asset with the potential for significant value appreciation as well as an inflation hedge.