Japan classifies XRP as financial asset amid Ripple's vision to bridge crypto-TradFi gap

Japan’s cabinet approved a bill to amend the Financial Instruments and Exchange Act (FIEA) at a cabinet meeting. If passed, the legislation is expected to take effect as early as fiscal 2027. The bill would classify XRP and other crypto assets as financial instruments, while tightening oversight to prohibit insider trading and transactions based on non-public information. It would also require crypto issuers to disclose relevant information once a year.

Key provisions of Japan’s proposed FIEA amendments

The bill is designed to bring crypto assets under the FIEA framework by classifying XRP and other crypto assets as financial instruments. It also aims to strengthen market integrity through rules intended to prevent insider trading and trading on non-public information. In addition, the measure would introduce annual disclosure requirements for crypto issuers, which is expected to improve the overall market environment.

Japan’s crypto market context and FSA classification approach

Japan has seen widespread crypto adoption, with accounts at crypto exchanges surpassing 12 million and user deposits reaching over 5 trillion yen. The article also notes that more than 1,200 institutional investors are investing in spot Bitcoin exchange-traded funds (ETFs).

Under the Financial Services Agency (FSA) classification described in the article, crypto assets issued as a means of fundraising—where proceeds are used for projects, events, community activities, and similar purposes—would be treated as Type 1 under the FIEA. In contrast, Type 2 crypto assets would include Bitcoin, Ethereum, XRP, and meme coins.

The article further states that the US SEC and CFTC have recently classified XRP and other crypto assets as non-securities, which it says supports institutional adoption and growing interest from traditional finance (tradFi).

Ripple’s perspective and Japan’s relevance

Ripple CEO Brad Garlinghouse said XRP and the RLUSD stablecoin help bridge the gap between tradFi and the crypto industry. The article also highlights Japan’s strategic importance for Ripple and XRP, citing longstanding ties through partners including SBI Holdings. It adds that the XRP Tokyo 2026 conference pointed to XRP’s expansion into financial areas such as adoption by institutional investors, RWA tokenization, and DeFi.

Market snapshot: XRP price and derivatives activity

XRP is currently trading at $1.33. The 24-hour low and high are $1.32 and $1.37, respectively. Trading volume has decreased as traders position ahead of crypto options expiry and US CPI inflation data.

Spot XRP ETFs and futures positioning

Spot XRP ETFs have recorded over $41 million in net inflows in 2026, according to the article. CoinGlass data cited in the article also indicates buying activity in the derivatives market in the last few hours.

The total XRP futures open interest rose almost 2% to $2.43 in 24 hours. The article adds that the 4-hour XRP futures open interest increased 0.52%, while it is down 0.18% and 0.53% on CME and Binance, respectively.