Japanese Regulator Eyes Ban on Crypto Insider Trading: Nikkei

Core Viewpoint - Japanese regulators are planning to ban insider trading on cryptocurrencies, marking a significant regulatory development in the country known for its early engagement with digital assets [1][2]. Group 1: Regulatory Changes - The Securities and Exchange Surveillance Commission (SESC) will be authorized to investigate suspected insider trading violations and can issue surcharge recommendations or criminal referrals [1]. - The Financial Services Agency, the parent organization of the SESC, aims to discuss and pass new laws by 2026 to explicitly prohibit trading cryptocurrencies based on undisclosed information [2]. Group 2: Context and Background - Insider trading, defined as using non-public information to trade assets, has not previously applied to digital assets in Japan [2]. - The first known case of insider trading in the crypto space occurred in the U.S. in 2022, involving a former Coinbase product manager who leaked information about token listings [3]. - Japan has a historical significance in the crypto market, being home to the now-defunct Mt. Gox exchange, which faced a major hack leading to its closure in 2014 [3].