Japan’s top asset managers prepare crypto trust products ahead of regulatory changes

Japan’s largest investment managers are showing a coordinated shift toward Bitcoin and other digital assets as policymakers advance plans to revise the country’s financial rules.

A group of major firms in Japan has confirmed they are preparing product frameworks for crypto-linked investment vehicles, anticipating the first expansion of the sector since current regulations barred digital assets from being included in investment trusts.

Large managers prepare for crypto-linked trusts

According to information reported by Nikkei, six firms, Daiwa Asset Management, Asset Management One, Amova Asset Management, Mitsubishi UFJ Asset Management, SBI Global Asset Management, and Nomura Asset Management, said that they are evaluating or building strategies for cryptocurrency investment trusts. These discussions follow renewed consideration within policy as to whether such products should be permitted under Japan’s financial system for the first time.

Under the current rules, crypto assets may not be packaged within investment trusts. The framework is currently being reviewed by policymakers as part of a wider regulatory review. The Financial Services Agency (FSA) has the authority to reclassify cryptocurrencies as financial instruments and exchanges under the Financial Instruments and Exchange Act, rather than the Payment Services Act.

The reform would apply taxation to digital assets, such as financial properties, and aligns with an ongoing plan to add a flat 20% tax on crypto profits, similar to other equity and bond gains.

According to Nikkei, the FSA is expected to pass the proposed changes to its legal framework in the 2026 regular parliamentary session. Provided the reforms are passed, they would also require amendments to the Investment Trust Act to pave the way for the introduction of cryptocurrency investment trusts, making them available to retail buyers and, in the future, institutional investors.

Japan’s asset managers outline product plans

SBI Global Asset Management announced plans to launch exchange-traded funds based on Bitcoin and Ether, as well as develop diversified crypto-focused investment trusts. The firm has set a target to manage approximately $32 billion, or 5 trillion yen, in total assets within three years of its launch. Nomura Asset Management has developed internal teams focused on crypto-product development and stated that it has systems in place, ready to launch at short notice once new regulations come into force.

One of the firms that has shown interest is Mitsubishi UFJ Asset Management, which is a subsidiary of Mitsubishi UFJ Financial Group. Mitsubishi UFJ Financial Group has an estimated total asset value of 2.7 trillion.

The company has been involved in blockchain-related projects, including the development of a stablecoin interoperability system. Daiwa Asset Management, which reported assets under management of approximately 213 billion as of March 2024, was also an indication that it was interested in providing crypto-based trust products.

Asset Management One and Amova Asset Management were found to be investigating their involvement in a potential new market. Each of the firms indicated that any of the offerings would be aimed at both retail and institutional segments, as soon as such offerings would be possible under the law.

The country’s financial regulator has taken note of the growing interest from investment managers and stated that it is also considering launching investment trusts that comprise cryptocurrencies. According to Nihon Keizai Shimbun, this could increase the participation of the domestic market in digital assets, as it would enable regulated products to be offered to mainstream investors.

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