Japan Investors Exit Crypto Not Because of Volatility, But Because of This

A new survey shows that Japanese investors are stepping away from crypto not because of volatility, but because the tax system is too complicated. The poll, conducted by financial planning platform 400F with 894 respondents, found that 22.2% of former crypto holders quit mainly due to tax burdens—surpassing the 19.4% who blamed price swings. Current investors say both volatility (61.4%) and complex reporting rules (60%) are nearly equal pain points.

Japan taxes crypto gains as miscellaneous income, with rates reaching up to 55%, and requires tracking every trade and calculating yen-denominated profits. For many, this administrative load outweighs the long-term wealth opportunities. Notably, 40% of neutral-risk investors say they would increase crypto exposure if regulators clarified taxation. With the FSA reportedly considering reclassifying crypto as a standard financial product and lowering the top tax rate to 20%, streamlined rules could reignite Japanese interest in digital assets.

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