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Japan reclassifies Bitcoin to unlock ETFs

Sunday, July 19, 2026 · from 2 podcasts
  • Japan reclassified Bitcoin as a financial asset, clearing the path for spot ETFs.
  • EU’s MiCA rules backfired, pushing 70% of users into self-custody.
  • New Hampshire codifies self-custody as a legal right.

Japan has reclassified Bitcoin as a financial asset, removing a key barrier to spot ETF approval. The change moves crypto from the Payment Services Act to the Financial Instruments and Exchange Act, aligning it with stocks and bonds.

This isn’t symbolic. The shift ends structural roadblocks for Japanese asset managers and cuts the top tax rate on crypto gains from 55% to 20% by 2028. South Korea is following the same playbook, updating 1950s-era property laws to include digital assets.

"The influx of institutional investors is peeing in the pool."

- David Bennett, Bitcoin And | Bitcoin & Economic News

Japan and South Korea are absorbing Bitcoin into legacy finance to enable institutional access. But in Europe, the opposite is happening. MiCA’s strict KYC and travel rules triggered an exodus: when Binance pulled out, 70% of users moved to self-custody, not regulated exchanges.

The regulatory design backfired. Instead of channeling users into compliant platforms, it pushed capital beyond oversight entirely. New Hampshire is now codifying self-custody into law, creating a legal firewall against federal overreach.

"Every compliance layer acts as a control point. By choosing self-custody, users are removing assets from regulatory reach."

- Frederico Rivi, Bitcoin And | Bitcoin & Economic News

The split is deepening: East Asia institutionalizes, Europe decentralizes, and U.S. states push back. The battle isn’t just over regulation - it’s over who controls the asset.

Source Intelligence

- Deep dive into what was said in the episodes

Xalgorithm | Bitcoin NewsJul 15

  • South Korea is updating its State Asset Management Act to include digital assets and IP, with plans to tokenize government bonds on a blockchain by 2027 and explore tokenizing state-owned real estate.
  • Japan passed an amendment reclassifying cryptocurrency as a financial asset under the Financial Instruments and Exchange Act, moving it from the Payment Services Act. This opens a path for spot Bitcoin ETFs and cuts the top tax rate on crypto gains from 55% to 20% starting in 2028.
  • Stripe offered to buy PayPal for $53 billion at $60.50 per share, a 28% premium over PayPal's closing price of $47.37.
Also from this episode: (6)

Politics (2)

  • New Hampshire Governor Kelly Ayotte signed HB 639, the Blockchain Basic Laws Act, providing protections for cryptocurrency innovation and self-custody of digital assets. The state also allows its treasurer to invest up to 5% of public funds in Bitcoin.
  • The U.S. Treasury froze $131 million in cryptocurrency held in Tron wallets linked to Iran, part of a broader campaign where Treasury has seized around $1 billion in Iranian crypto assets.

Protocol (3)

  • After Binance suspended services in the EU due to MiCA, internal data shows 70% of withdrawn user funds went to self-custody wallets and only 30% to other regulated exchanges.
  • David Bennett argues the trend of countries creating legal frameworks for digital assets is inevitable, but warns against letting intermediaries custody Bitcoin due to future regulatory pressure.
  • Bennett notes Bitcoin's price was $65,040 with a market cap of $1.3 trillion, and the network had over 20 million coins with an average fee of 0.01 per block.

Regulation (1)

  • The Czech Republic added prediction market platform Polymarket to its list of unauthorized internet games, requiring ISPs to block access within 15 days. Other countries like Germany, Belgium, and Poland have also restricted it.

#770: The Western Canon Belongs To Your Child with Chapter HouseJul 15

Also from this episode: (18)

Education (6)

  • Josh and Hannah founded Chapter House to publish beautiful hardcover editions of old homeschool texts, driven by frustration with thin paper, poor binding, and digital copies.
  • Hannah adapted Charlotte Mason homeschooling methods, focusing on reading old books aloud and avoiding regimented lesson planning like public school bell-to-bell schedules.
  • Josh argues modern education's focus on standardized tests and credentialing produces spreadsheet brain thinking, where students can decode sentences but lack comprehension of sarcasm or simile.
  • Josh states the public school system’s Prussian industrial cog model is inhumane and obsolete, while STEM emphasis misses that LLMs now handle technical work, leaving human communication and critical thinking as the valuable skills.
  • Chapter House's mission is to form good human beings through virtue and wonder, not economic productivity, citing Plato and Aristotle who placed character formation above facts.
  • Hannah advises starting reading with Chapter House’s green set for shorter stories, reading 20 minutes daily even if children move or play with Legos, because boys especially need movement and still listen.

Philosophy (6)

  • Josh identifies wisdom and courage as foundational virtues, noting courage is often lacking in younger people today, while Hannah adds loyalty and honor.
  • Hannah explains virtue must be intrinsic, displayed unbidden by children in playground interactions, not enforced through obedience lessons.
  • Josh links societal freedom to virtue, quoting a founding father that a nation suited for virtuous people pivots to tyranny when virtue declines.
  • Josh argues wonder balances virtue, citing his son’s exploration of a tree crater as displaying bravery and innovation, while Elon Musk exemplifies wonder-driven ambition.
  • Josh states wonder without virtue produces dreamers or criminals, like the high school genius who never applied his intelligence and still lives with his parents.
  • Josh defends the Western canon as the superior global culture, noting Xi Jinping studies Plato and Homer, and Western products like KFC and blue jeans are coveted worldwide.

Culture (5)

  • Josh’s Christian conviction shapes Chapter House’s book selection, influenced by Dr. John Sr.’s Integrated Humanities Program at University of Kansas which led students to convert to Catholicism.
  • Josh reads pagan myths to highlight capricious gods, arguing they show Christianity’s superiority because pagan rituals stopped working wherever missionaries brought Christ.
  • Hannah says courage is better taught through stories like Beowulf than explicit lessons, citing her son’s spontaneous connection of Beowulf to saints as proof of deeper comprehension.
  • Hannah uses narration instead of explaining morals, where children retell stories to develop their own connections, like her oldest linking Harry Potter and Oliver Twist as orphan narratives.
  • Josh cites the George Washington cherry tree myth, though likely fabricated by Mason Weems, as truth because it inspired Abraham Lincoln who worked to replace the ruined book and later spoke about it in a presidential speech.

History (1)

  • Hannah advocates reading unsanitized myths with frightening monsters and death, referencing C.S. Lewis that children need to know monsters can be slain, not just told they exist.