What is the point for NFT games in terms of regulation in Japan?
It depends on if the gaming is counted as crypto asset.
Token gives values to gaming items as proprietary that cannot be duplicated.
In general, the items themselves cannot be used as payment methods, so they do not qualify as cryptocurrency.
However, once the items get the position of cryptocurrency that can be used outside of the game, they could potentially be subject to regulation as cryptocurrencies.
Does it mean that the item will be regulated as same as Bitcoin and Ethereum?
Cryptocurrencies such as Bitcoin and Ethereum, for which exchange markets with fiat currencies exist, are defined as Crypto Asset No.1 falling under Article 2-5-1 of the Payment Services Act.
If tokens from the NFT game can be freely exchanged for fiat currency outside the game, it might be considered as Crypto Asset No.1 as same as Bitcoin and Ethereum.
If it cannot be exchanged for fiat currency but can be exchanged for Bitcoin or Ethereum, it would qualify as Crypto Asset No.2.
Under which laws are cryptocurrencies regulated?
Cryptocurrencies had been subject to regulation under the Payment Services Act as a means of payment, just like prepaid cards and stable coins.
However, following a Cabinet decision on April 10, 2026, these investments will be subject to regulation under the Financial Instruments and Exchange Act, just like securities and derivatives.
As a result, you will need to comply with the new regulations under the Financial Instruments and Exchange Act, just like securities and derivatives.
In any case, for NFT games whose token are qualified as cryptocurrencies, the definitions of "crypto-asset exchange business" and "crypto-asset service intermediary business" are key points to consider.
What is the difference between “crypto-asset exchange business” and “crypto-asset service intermediary business” ?
"Crypto-asset service intermediary business" was newly added in the 2025 amendment to the Financial Instruments and Exchange Act.
Prior to the amendment in 2025, any business that bought or sold cryptocurrencies, acted as intermediary in transactions, managing user's fund for cryptocurrencies and/or managing user's cryptocurrencies itself was classified as "crypto-asset exchange business".
If a business falls under the "crypto-asset exchange business", it must register and be supervised by Financial Service Agency of Japan. To obtain this registration, the business must meet various requirements, including financial criteria, and is subject to follow various operational regulations.
Because of this background, NFT games have traditionally been designed to avoid being classified as crypto asset.
However, with the 2025 amendments, the "crypto-asset service intermediary business" was established, and registration requirements became more lenient. Moreover, the operational framework has also been suit NFT games.
Wouldn’t it be better to operate an NFT game – which doesn’t consider as cryptocurrency- rather and registering as crypto-asset service intermediary and being subject to regulation?
One of the appeals of NFT games is scalability. Tokens can be transferred between games, traded as crypto assets within the metaverse and Play to Earn. it might be better to design them with crypto asset in mind.
Japan is leading the world by establishing categories such as Crypto Asset No.1 and No2, as well as defining business models like crypto asset service intermediary. Applying a legal framework to the decentralized mechanism of NFTs is truly groundbreaking.
While every gaming title designed for simultaneous global release, this law only applies within Japan. However, precisely because of this, launching an NFT game that complies with Japan's legal framework ahead of the rest of the world can be seem a way to build credibility.
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