Japan Reclassifies Crypto as Financial Asset, Paving Way for ETFs, Tax Cuts

Japan passed a landmark law recognizing crypto as financial products, enabling future ETFs and cutting the top tax rate to 20%. Circle opened a first-of-its-kind federal trust bank and won an arbitration against a Tether-backed fund, while the White House prepared a meeting to resolve the Clarity Act ethics dispute. In other news, an Ostium oracle exploit drained up to $22M and the US Treasury froze $131M in Iran-linked crypto wallets.

Written by AI from the sources it cites; it can be wrong — follow any citation to confirm.

9 sources2 min read

Japan passes law classifying crypto as financial products, lowering taxes The law shifts crypto from a payments framework to an investment regime, enabling future spot bitcoin ETFs and cutting the top tax rate from 55% to 20% by 2028. It also imposes stricter insider-trading rules and increases penalties for unregistered operators. 1 2

Circle opens federal trust bank, defeats Tether-backed fund in arbitration Circle's de novo federal trust bank charter is the first for a digital asset firm, set to eventually manage USDC reserves. The company also won an arbitration case against Tether-backed Heka Funds, which had sought $49 million in damages. 3

White House plans high-level meeting to resolve Clarity Act ethics dispute President Trump and senators will meet Thursday to hash out the ethics provision restricting officials' crypto ties, the last major obstacle to the market structure bill. A compromise is critical for the bill's passage this session. 4

Ostium oracle exploit drains up to $22 million, trading suspended An attacker exploited a registered PriceUpKeep Forwarder and fabricated trades on the Arbitrum-based RWA protocol, draining between $18M and $22M from liquidity vaults. The protocol suspended trading and users were advised to revoke approvals. 5 6

US Treasury freezes $131 million in Iran-linked crypto wallets The Treasury sanctioned and seized $131 million in crypto assets linked to Iran, continuing financial pressure amid ongoing military strikes. The action highlights growing use of crypto enforcement in geopolitical conflicts. 7

Ether outperforms bitcoin as BlackRock ETF inflows hit $96 million Spot ether ETFs took in $96M in the first three days of the week, with BlackRock's ETHA absorbing the bulk, while bitcoin ETFs saw volatile flows. Ether rose 11% over seven days, benefiting from new demand from Robinhood Chain. 8

Solana surges after $500 million USDC mint, supertrend signal flashes Circle minted $500M USDC on Solana in two tranches, injecting fresh stablecoin liquidity that helped SOL climb toward $78. The movement also triggered three-day supertrend buy signal for the first time since October. 9