Japan could launch its first Bitcoin exchange-traded fund as early as 2028, as regulators prepare rules that would allow mutual funds and ETFs to hold crypto assets directly.
According to a report in the Nikkei Shimbun on July 23, the Financial Services Agency plans to revise the rules for investment funds after lawmakers approved a bill to incorporate crypto assets into the framework of the Financial Instruments and Exchange Act. With this change, Japan will move towards treating cryptocurrencies as financial investment products rather than regulating them primarily as payment assets.
On the other hand, the legal change does not mean that Bitcoin ETFs can be launched immediately. Japan still needs detailed rules and changes to its investment trust framework before fund managers can offer products that invest primarily in cryptocurrencies.
FSA documents confirm that cryptocurrency regulation will move from the Payment Services Act to the Financial Instruments and Exchange Act, with new disclosure and market conduct requirements.
Bitcoin ETF: Is Japan overly focused on individuals rather than institutional investors? Estimated inflow of 3 trillion yen https://t.co/7LMLSjMw3e
— Nihon Keizai Shimbun electronic version (Nikkei electronic version) (@nikkei) July 22, 2026
As crypto.news reported on July 15, Japan has passed a bill paving the way for domestic crypto ETFs, although individual products will still require regulatory approval. Previous reports said that Japan Exchange Group was considering listing as early as 2027, but the latest Nikkei report lists 2028 as a possible listing date.
JPX CEO Hiroki Yamamichi previously said that ETFs could be implemented at any time once the legal framework is in place and the tax treatment is clear.
Financial group prepares for Bitcoin ETF
Several major Japanese financial companies are researching products that could enter the market once regulators finalize the rules. As previously reported, SBI Securities and Rakuten Securities are preparing virtual currency investment trusts through their respective groups. Nomura, Daiwa, Sumitomo Mitsui Banking Corporation and Asset Management One are also considering the possibility of a product.
The planned market could expand beyond Bitcoin ETFs. SBI Global Asset Management has been considering funds that focus on liquid crypto assets such as Bitcoin and Ethereum. Meanwhile, the Osaka Exchange is considering launching Bitcoin futures in 2028 if spot ETFs are legalized. These plans show that traditional financial companies are preparing products before regulators finalize the framework.
Interest from educational institutions is also increasing. A 2026 study by Nomura Holdings found that 79% of respondents considering investing in cryptocurrencies in the next three years plan to do so. Of these, we expect 60% to allocate between 2% and less than 5% of their portfolio. The survey also found that 65% consider crypto assets as a way to diversify their investments.
Individual investors may become the main source of demand
Japan’s Bitcoin ETF market may develop differently than the US market, where institutional investors are major participants in Bitcoin Spot ETFs. While few institutions in Japan have large-scale virtual currency allocations, households continue to hold the majority of their financial assets in cash and deposits. According to data from the Bank of Japan, cash and deposits account for about half of household financial assets.
This structure could potentially make individual investors a major source of demand. A Nikkei report on July 23 estimated that Japan’s Bitcoin ETF could collect up to 3 trillion yen by fiscal 2028.
The Financial Services Agency also reports that there are more than 14 million virtual currency accounts in Japan, but approximately 70% of account holders have an annual income of less than 7 million yen. Regulated ETFs could allow investors to gain exposure to Bitcoin through their brokerage accounts without directly managing a crypto wallet.
A similar focus on retail can be seen among financial groups preparing new products. Rakuten plans to make its cryptocurrency investment trusts available through smartphone services, and other securities companies are also considering products that fit into existing investment platforms used by individual customers.
Annuity interest adds new route for crypto exposure
Although institutional adoption remains limited, some pension administrators in Japan have begun testing small crypto allocations. The National Corporate Pension Fund (Okayama City), which has approximately 1,200 small and medium-sized enterprises as members, plans to allocate approximately 1% of its assets to virtual currency-related funds by the end of fiscal 2026.
Ai Kiguchi, the fund’s management manager, explains the diversification strategy as “because the correlation between price movements and the dollar is low.” The fund manages approximately 21.5 billion yen, and rather than purchasing crypto assets directly, it plans to gain exposure through funds managed by major overseas hedge funds.
The move also comes in response to growing interest from a broader range of investors. Nomura’s research found that while financial companies continue to prepare for the possibility of mutual funds and ETFs, demand for cryptocurrencies as a diversification tool is increasing. Japan Exchange Group also said that asset management companies are showing interest in crypto-related products.
Japan’s next steps will depend on how quickly the Financial Services Agency completes its investment trust rules and how exchanges set their listing requirements. For now, the country is moving closer to a domestic Bitcoin ETF market due to regulatory changes, asset managers’ readiness, and increased investor interest. The latest reporting schedule puts the first launch as early as 2028, with retail investors likely to provide the bulk of the demand.
