Japan Brokerages to Launch Crypto Funds as New Law Paves Way for 2027 Start

Japan’s largest brokerages are preparing to launch cryptocurrency investment trusts for retail investors, with SBI Securities and Rakuten Securities developing in-house products ahead of a regulatory overhaul expected to formally permit such funds by 2028. The move could unlock a significant wave of retail capital into the world's third-largest economy.

"The change would be important for ordinary investors because crypto access in Japan still usually requires a separate exchange account or wallet setup," a Nikkei report on Sunday stated. Investment trusts could allow customers to gain exposure to assets such as Bitcoin and Ethereum through the brokerage platforms they already use for stocks and bonds.

The regulatory shift includes a revision to the Investment Trust Act by 2028 and an amendment to the Financial Instruments and Exchange Act, expected to take effect in fiscal 2027, which reclassifies crypto assets as financial instruments. SBI Securities plans to offer funds from its subsidiary, SBI Global Asset Management, while Rakuten Securities is working with Rakuten Investment Management on products accessible via smartphone apps.

This mainstream push could reshape Japan's retail crypto market, currently dominated by specialized exchanges like Coincheck. With giants like Nomura, Daiwa, and SMBC Group also exploring entry, the new framework sets the stage for a more competitive and accessible market, potentially culminating in the launch of spot crypto ETFs as early as 2028.

SBI and Rakuten Lead In-House Development

SBI Securities and Rakuten Securities are at the forefront of this shift, opting to build their crypto fund products internally. According to a Nikkei report, SBI plans to manage the entire process from development to distribution through its group companies, including SBI Global Asset Management. This integrated model is expected to cover both investment trusts and ETFs focused on liquid assets like Bitcoin and Ethereum, giving SBI greater control over fees and compliance.

Rakuten Securities is pursuing a similar strategy, collaborating with Rakuten Investment Management. Their focus is on creating products that can be seamlessly traded through smartphone applications, a key channel for Japan's retail investors. By offering crypto exposure through familiar brokerage apps, both firms aim to capture a segment of the market that is interested in digital assets but hesitant to navigate the complexities of crypto-native exchanges and self-custody wallets.

Incumbents Await Final Rules

The country's largest financial groups are also positioning themselves for the new market. Nomura Holdings and Daiwa Securities Group have announced plans to develop their own crypto investment trusts. Meanwhile, SMBC Group has established a task force to evaluate its options, and Mizuho Financial Group's Asset Management One has started preliminary work.

This activity comes as Japan’s Financial Services Agency (FSA) lays the groundwork for a more structured crypto investment environment. An amendment to the Financial Instruments and Exchange Act, which puts crypto assets under the same regulatory umbrella as stocks, is expected to pass in the current parliamentary session and take effect in fiscal 2027. Furthermore, the FSA is set to revise the Investment Trust Act by 2028, formally adding cryptocurrencies to the list of assets that investment trusts can hold.

The potential for spot crypto ETFs, possibly as early as 2028, is also a significant driver. SBI Holdings has already revealed plans for a Bitcoin-XRP dual ETF and a gold-crypto ETF, pending regulatory green lights. The introduction of ETFs would offer another regulated, exchange-traded avenue for crypto exposure, further bridging the gap between traditional finance and digital assets in Japan.

This article is for informational purposes only and does not constitute investment advice.