Japan plans to classify XRP as a regulated financial product before Q2 2026

The Japan Financial Services Agency plans to reclassify Ripple's XRP from the "crypto asset" category under the Payment Services Act to a "regulated financial product" and include it in the regulatory framework of the Financial Instruments and Transactions Act by the second quarter of 2026. This move aims to match the important position of XRP in Japanese institutional applications. After reclassification, XRP will receive the same "investment grade" status as traditional stocks and bonds, with exchanges and liquidity providers required to disclose asset volatility, technical characteristics, and issuer relationships, while prohibiting insider trading and market manipulation to strengthen investor protection.