Japan FSA Opens Public Consultation on Stablecoin Reserve Rules

Japan’s FSA launches public consultation on stablecoin reserve rules, setting new standards for collateral, issuance, and user protections.

Japan’s Financial Services Agency (FSA) has initiated a public consultation on draft rules for stablecoin reserve assets under the 2025 payments law overhaul. This move aims to clarify requirements for trust-structured stablecoins while ensuring protection of investors. The purpose of the consultation is to set out how assets are to be managed in case of domestic and foreign-issued stablecoins.

FSA Clarifies Reserve Assets and Issuer Requirements

In the draft rules, it is listed what types of bonds can be used as collateral by yen-pegged stablecoins. Eligible foreign-issued bonds must have a credit rating of 1 – 2 or above.

Additionally, the amount of bonds issued by issuers must be at least 100 trillion yen, about $648 billion. These measures are aimed at mitigating the risk of default and boosting investor confidence in stablecoins.

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The amendments set under the 2025 law would give stablecoin issuers the option of holding up to 50% of issuance in low-risk assets. These are short-term government bonds and fixed-term deposits. Only licensed banks, trust companies and registered money transfer agents are still authorized issuers.

Foreign stablecoins could be sold with licenses from intermediaries. Extra compliance checks are required to verify compliance with domestic regulations and user protection standards.

Furthermore, all stablecoin issuers are required to keep segregated custody of reserve assets, which ensures the full backing of some reserve assets and secure asset management.

Stablecoin Regulation Supports Innovation While Ensuring Safety

The FSA’s draft rules are aimed at improving liquidity and profitability for the stablecoin issuers while also safeguarding the users. By establishing the requirements for eligible assets and for issuers, the guidelines offer clearer operational frameworks. Issuers are to keep separate custody in licensed custodians, similar to e-money rules.

Japan’s consultation shows global trends in stablecoin regulation. Countries across the world, including the United States and European Union are looking at similar frameworks for digital assets.

The FSA’s approach focuses on innovation as well as reducing risk. It also ensures that Japan does not lose its competitive edge in the fintech industry while safeguarding the financial system.

The consultation period ends on February 27, 2026, which gives industry stakeholders, financial institutions and the public the chance to voice out their feedback. The FSA encourages all participants to go over draft notices carefully and submit comments to refine final regulations.

Overall, these reforms under the 2025 Payment Services Act have the goal of boosting Japan’s digital payment infrastructure. By combining operational agility with high compliance standards, the FSA is promoting responsible stablecoin adoption.

The measures also provide for the security and transparency of the reserve assets that benefit both domestic and international users.

As the number of stablecoin users worldwide continues to grow, Japan’s proactive approach may become a model for other regulators to follow. Clear thinking in terms of collateral, reserves, and issuer requirements is expected so that institutional participation is encouraged while reducing systemic risk.

Ultimately, the consultation shows the commitment of the Japanese government to establish a safe and well-regulated market for digital assets.

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