Bybit, the second-largest cryptocurrency exchange by trading volume, plans to stop new user sign-ups from Japan starting October 31, 2025, at 12:00 PM UTC. This targets Japanese residents and nationals, while existing accounts retain full access to services without disruption.
Proactive Compliance Move
Bybit positions this as a strategic adjustment to Japan’s stricter digital assets rules. The Financial Services Agency (FSA) intends to oversee crypto under the Financial Instruments and Exchange Act (FIEA), imposing standards akin to securities, such as improved asset custody and disclosure requirements. This aims to address risks like cyberattacks and ensure market integrity.
Bybit has encountered FSA scrutiny before, receiving warnings in 2021 and 2023 for unregistered operations. Halting new registrations signals a shift toward pursuing full licensing and avoiding further penalties.
Japan’s Broader Crypto Clampdown
This decision mirrors Japan’s intensified focus on cryptocurrency exchange regulation in a market with over 12 million active accounts as of mid-2025. The FSA targets unlicensed platforms and bolsters anti-money laundering (AML) measures to combat fraud and manipulation. Recent actions include warnings to multiple exchanges for non-compliance.
Yet, Japan balances control with progress. Recent proposals allow banks and financial institutions to hold and trade digital assets like Bitcoin, treating them like stocks under safeguards for stability. This could integrate crypto into mainstream finance, fostering a secure yet dynamic sector.
Implications for Global Exchanges
For platforms like Bybit, adapting to local laws is essential. This pause may enable operational reviews and a licensed return, highlighting how national policies influence worldwide access. Japan’s model firm enforcement with innovation could inspire other regions as FIEA updates progress into 2026.
Recent social discussions echo the announcement, with users noting its alignment with emerging FSA guidelines. As oversight evolves, exchanges must prioritize adherence to sustain growth in key markets like Japan, where user adoption continues to rise.
