Japan’s Biggest Brokerages Open a New Door for Bitcoin and Ethereum Investment

• SBI Global Asset Management targets ¥5 trillion ($32 billion) in crypto trust assets within three years of launch
• Eleven of eighteen surveyed Japanese financial firms said they would enter the market once regulatory framework is finalized
• Japan’s FSA is weighing rules to allow investment trusts and ETFs to hold crypto, with spot crypto ETF approval potentially by 2028

• ¥5 trillion SBI’s three-year asset target for in-house Bitcoin and Ethereum trusts
• 11 of 18 Major Japanese brokerages signaling intent to enter regulated crypto trust market
• $6.4 billion Estimated potential inflows to Japanese crypto ETF market by 2028

SBI Securities and Rakuten Securities are preparing to launch regulated investment trusts holding Bitcoin and Ethereum, allowing Japanese retail investors to gain crypto exposure through their existing brokerage accounts rather than opening separate exchange wallets.

The move marks the first major shift in how mainstream Japanese investors access digital assets, removing friction that has historically required technical knowledge and multiple account types. Both firms, operating licensed crypto exchanges, are leveraging existing regulatory relationships and infrastructure to accelerate product rollout ahead of formal FSA approval.

SBI targets $32 billion in managed crypto assets as Japan’s largest broker builds in-house trusts

SBI Securities plans to distribute Bitcoin and Ethereum investment trusts developed by group company SBI Global Asset Management, positioning the offering as a fund-like product accessible directly from brokerage platforms.

The firm has set an ambitious three-year target of approximately ¥5 trillion (nearly $32 billion) in assets under management, suggesting confidence in rapid adoption among its retail customer base. By managing the full chain internally, from product design to regulatory compliance to distribution, SBI is removing intermediaries that could slow deployment or limit customization.

The investment trust structure itself removes a critical barrier for Japanese retail participation. Rather than requiring customers to purchase Bitcoin or Ethereum directly on a crypto exchange, investors can buy units of a regulated fund holding these assets, similar to buying shares in a mutual fund or bond fund.

This approach integrates seamlessly with existing brokerage workflows, reducing onboarding friction and lowering barriers to entry for investors already comfortable with traditional securities trading.

Rakuten Securities is pursuing an identical strategy through Rakuten Investment Management, prioritizing mobile app integration to match how Japanese retail crypto activity already operates. Both groups benefit from licensed exchange operations already in place, meaning regulatory approval and custody infrastructure are substantially developed.

This head start positions them to capture significant market share as rules solidify, potentially establishing lock-in effects before competitors fully launch.

Nomura, Daiwa and Mizuho signal readiness to enter crypto trust market once FSA framework is final

In a survey of 18 major Japanese financial firms, 11 indicated they would enter the regulated crypto trust market immediately upon FSA approval, according to reporting from Nikkei. Nomura and Daiwa have explicitly signaled intentions to develop crypto trusts, while SMBC Group has formed a dedicated task force. Asset Management One, operating under Mizuho, has begun early-stage research.

This broad willingness from Japan’s largest traditional brokers and asset managers suggests the market is not being driven by fringe players but by core institutional infrastructure.

The depth of interest reflects realistic expectations about regulatory timing and scope. The Japan Financial Services Agency is actively weighing rules under the Investment Trust Act that would permit investment trusts and exchange-traded funds to hold cryptocurrency directly.

Unlike the earlier, more restrictive crypto exchange licensing regime, this framework would allow mainstream financial institutions to offer crypto-linked products without requiring specialized exchanges or separate business divisions.

The shift represents a decisive departure from Japan’s post-2018 regulatory posture, when the country imposed strict exchange licensing rules following the Mt. Gox collapse. Recent reclassification of crypto as a financial instrument rather than a commodity signaled regulatory intent to integrate digital assets into broader financial infrastructure.

Major institutions waited for this clarity before committing development resources, and the recent FSA signals have released pent-up demand across the industry.

FSA targeting 2028 crypto ETF approval with market reaching $6.4 billion in inflows

Japan’s Financial Services Agency is reportedly developing a regulatory timeline for crypto ETF approval by 2028, with analysts estimating potential inflows into such products could reach approximately $6.4 billion. This approval pathway would formalize custody, pricing and operational standards, transforming crypto from a specialized asset class into a mainstream institutional offering.

The ETF structure, combined with investment trust frameworks, would create multiple pathways for institutional and retail participation at different risk and liquidity preferences.

The 2028 timeline provides clarity for product development cycles, allowing firms to coordinate infrastructure buildout with anticipated regulatory approval. SBI’s three-year ¥5 trillion asset target aligns strategically with this window, suggesting confidence that investment trusts will operate as proof-of-concept products leading to broader ETF approval.

The phased approach de-risks regulatory uncertainty while allowing early movers to establish brand positioning and customer relationships.

Spot crypto ETFs in developed markets have proven institutional gateway products, with significant inflows following approval in the United States and Canada. Japan’s $6.4 billion estimate appears conservative given that the country represents the world’s third-largest economy and has historically strong retail investment participation.

However, the figure assumes successful regulatory passage and investor adoption, neither guaranteed despite the present momentum.

Reclassification as financial instrument signals permanent shift in Japanese crypto policy

Japan’s recent reclassification of cryptocurrency from a commodity to a financial instrument represents the regulatory foundation enabling this entire shift.

This designation allows crypto to fit within existing financial services frameworks rather than requiring entirely new regulatory categories. Investment trusts and ETFs already operate under established oversight through the Investment Trust Act, meaning regulators can apply familiar prudential standards, custody rules and disclosure requirements to crypto-holding products.

The move eliminates a structural barrier that previously forced crypto and traditional finance into separate operating silos.

The timing reflects broader Japanese policy recognition that isolation from global crypto markets was not sustainable. As other major economies moved toward spot ETFs and institutional infrastructure, Japanese institutions faced arbitrage pressure, their customers and counterparties could access crypto-linked products abroad, but domestic rules limited domestic options.

By opening institutional pathways, Japanese regulators are reducing pressure for capital flight while capturing domestic regulatory jurisdiction over what would otherwise move offshore.

SBI and Rakuten’s internal product development could accelerate adoption across institutional customer base

Both SBI and Rakuten benefit from massive retail customer bases already familiar with their platforms and cultures of app-based trading. Integration of crypto trusts directly into existing brokerage interfaces removes the need for educational campaigns or separately marketed products.

Customers who trade stocks on SBI’s or Rakuten’s mobile apps could access Bitcoin and Ethereum exposure through one additional menu selection, matching the behavioral pattern of adding an ETF position.

This integration advantage is not trivial. Retail crypto adoption in Japan has historically required users to learn separate platforms, manage different logins and wallets, and develop comfort with exchange-specific operational risks. By collapsing these friction points, SBI and Rakuten could capture adoption from investors interested in crypto exposure but resistant to the operational complexity.

Early market data from other jurisdictions suggests mainstream adoption accelerates significantly once crypto becomes available through familiar retail distribution channels.

The internal development model also allows product customization and rapid iteration based on customer demand signals.

Both firms already operate licensed crypto exchanges, meaning they have teams experienced in digital asset operations, custody and compliance. Rather than licensing third-party products or partnering with specialized crypto asset managers, building in-house trusts allows SBI and Rakuten to maintain full control over user experience, fee structures and product roadmap.

This control should translate to competitive advantages in market share capture once competitors launch.

The critical forward-looking question is whether

Original reporting: beincrypto.com