[Japan Plans to Reclassify XRP Token as a Regulated Financial Product by Q2 2026] According to Finance Feeds, Japan's Financial Services Agency (FSA) plans to officially reclassify Ripple's XRP as a 'regulated financial product' by the second quarter of 2026. This move will shift XRP out of the 'crypto asset' category under the Payment Services Act and place it under the stricter regulatory framework of the Financial Instruments and Exchange Act. The aim is to align XRP's legal status with its extensive institutional use in Japan. XRP has become a cornerstone of the country's banking and remittance infrastructure. After the reclassification, XRP will gain an 'investment-grade' status equivalent to traditional stocks and bonds, which is expected to attract more institutional capital and provide a regulatory model for other major digital assets. The new regulations will require exchanges and liquidity providers to fully disclose information on asset volatility, technical characteristics, and relationships with issuers, while explicitly prohibiting insider trading and market manipulation to enhance investor protection.