The post Japan Passes New Crypto Regulation : Here’s What’s New appeared first on Coinpedia Fintech News On June 6 , Japan’s parliament officially revised the Payment Services Act (PSA) , introducing a domestic asset holding order aimed at preventing crypto outflows and protecting Japanese investors from the risks of overseas crypto exchange collapses . Why Did Japan Revise Its Payment Services Law? The revision is a direct response to the rising bankruptcy risks among foreign crypto exchanges . When such platforms collapse, the crypto assets held by Japanese investors are often at risk of outflows or loss . In 2024, a major crypto exchange in Japan was hacked, leading to a Bitcoin outflow worth over $305 million . The incident raised serious concerns about the security of customer funds and highlighted the need for stricter regulations . Key Highlights of Japan’s Revised Crypto Law Stronger Investor Protection: The new law mandates that crypto exchanges operating in Japan must hold investor assets domestically , shielding them from foreign exchange bankruptcies. Flexible Business Model: A new intermediary framework will allow smoother collaboration between crypto exchanges and users , even for in-app crypto asset use in games. Trust-Type Stablecoins Update: Issuers can now manage up to 50% of their stablecoin issuance in low-risk assets , creating room for innovation while maintaining safety. Stringent Registration Requirements: All crypto-related entities must now register under the revised PSA , with strict AML and CFT compliance rules in place. What’s Next? The law passed both the Lower House in May and the Upper House on June 6 . It will be enforced within a year . Japan is also introducing a new category for businesses that facilitate interaction between exchanges and users , encouraging innovation in crypto asset services while tightening oversight. Final Thoughts Japan’s proactive move shows a clear intent: protect domestic investors from foreign exchange failures , while fostering a safe and scalable crypto ecosystem . The revised Payment Services Act marks a significant step in balancing security, regulation, and innovation in Japan’s crypto space.