Japan’s Financial Services Agency (FSA) plans to require cryptocurrency exchanges to set up emergency reserves to cover potential losses from hacks.

Currently, exchanges must keep user deposits in cold wallets, but there is no mandate for separate liability reserves.

The agency aims to submit the new bill to parliament in 2026.

Earlier this month, the FSA was also reported to be preparing rules requiring third-party cryptocurrency custodians and trading partners to register with authorities before serving local exchanges.

These moves follow a 2024 hack at DMM Bitcoin, which caused losses of about US$312 million.

Japan is also considering reclassifying cryptocurrency assets under the Financial Instruments and Exchange Act and lowering the tax on digital asset gains to a flat 20%.

🔗 Source: The Block