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Japan’s Financial Services Agency (FSA) is exploring new regulations to let banks hold non-backed crypto assets such as Bitcoin. At the same time, New York City mayoral candidate Andrew Cuomo has unveiled plans to appoint a Chief Innovation Officer to lead blockchain and digital growth. Both initiatives aim to integrate digital assets into mainstream finance while boosting competitiveness in traditional financial sectors.
The FSA’s deliberations represent a shift from its cautious regulatory stance. Previous guidelines restricted banks from holding cryptocurrencies due to volatility risks. Yet, growing maturity in Japan’s crypto market has encouraged regulators to revisit those policies.
The country now hosts over 12 million registered crypto accounts, marking a 3.5-fold increase in five years. Regulators believe allowing banks to allocate capital to digital assets would classify them as official investments. This step could diversify portfolios and open new profit channels for banks.
Plans also include registering banks as cryptocurrency exchange operators. The move would let them offer crypto trading directly to clients through regulated platforms, increasing trust and accessibility. Strict compliance checks and transaction monitoring standards will accompany these changes to ensure secure adoption within the financial system.
The FSA’s reform agenda will include exposure limits to manage how much crypto banks can hold relative to capital. This ensures institutions maintain stability while gaining exposure to emerging assets. The council’s ongoing discussions are set to begin before the end of the year, signaling growing urgency.
Reviewing the policies, Japan is kept in line with the global trends as the world regulators review structures to strike a balance between innovation and financial soundness. The US and European Union countries, as well as other nations, are revising legislation in support of crypto involvement and mitigating systemic risks.
The Japanese strategy is cautious and progressive at the same time because it allows innovation but retains tight control. Its debt-to-GDP ratio of 240% can also play a part in urgency, as the government will be forced to pursue other growth measures.
In the US, Andrew Cuomo, an independent New York City mayoral candidate, has announced his plans to establish a Chief Innovation Officer position to spearhead the creation of crypto, AI, and biotech. He said that the new mayor should make sure that New York remains at the forefront of technologies that define the next century.
The Chief Innovation Officer would raise investments, develop employment, and introduce new technologies to better the services of the city. One of the plans developed by Cuomo is the establishment of a blockchain, AI, and biotech-based Innovation Council. The council would recommend the adoption of regulations, training of people in the workforce, and ease in the bureaucracy.
This strategy has the capability of bringing in new capital and talent and thus would help in closing the divide between conventional finance and crypto. The huge capital base of Wall Street, which is over $30 trillion, has the potential to make the city more innovative on a global scale. With the digital financial policies in Japan and New York moving forward, the question is: Will these ambitious policy actions transform the way established finance and new technology coexist?
Japan and New York City are moving in parallel toward digital transformation in finance. Japan’s FSA is reviewing reforms that could let banks hold Bitcoin and expand crypto trading. Meanwhile, Andrew Cuomo’s proposed Chief Innovation Officer aims to merge blockchain, AI, and biotech into New York’s public and financial systems.
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