This Week In Crypto Asia: India’s Crypto Tax Reforms, Japan’s Stablecoin Push, And DBS’s Tokenization Drive

[Redator]

The Asian crypto landscape is in constant motion, especially with the recent downturn that BTC and ETH experienced. Amidst all this, massive regulatory changes are underway in the Asian crypto sector.

Here is what transpired.

India’s Crypto Tax Talks Add Momentum To Asian Crypto Policy Reforms

The Central Board of Direct Taxes (CBDT), India’s direct tax authority, has reportedly consulted domestic crypto platforms regarding its current virtual digital asset (VDA) framework, according to a local report published on 18 August 2025.

Industry insiders revealed that the CBDT questioned the effectiveness of the current taxation system on crypto and sought input on whether they require a standalone legal regime.

The focus seems to be on the 1% tax that authorities deduct at source (TDS) on crypto trades, the restrictions on loss offsetting, and the ambiguity around offshore transactions.

The CBDT further requested inputs regarding the shortlisting of government agencies that would oversee the development of the new crypto framework.

India Eyes Crypto Tax Reform

CBDT in India is asking people for suggestions to improve crypto rules. They may reduce the 1% TDS on crypto trades and might allow investors to adjust losses, to make things easier and more fair.#CryptoNews #tax #India #Indian pic.twitter.com/vdDDqfBIyy

— Tanveer (@tanveeralam777) August 19, 2025

The taxation body has asked stakeholders in India’s crypto scene to provide data on crypto-related capital flight, particularly the volume of trading that has moved offshore due to heavy taxation, regulatory blind spots, and liquidity constraints.

Authorities also requested a comparison with other jurisdictions to assess India’s standing on tax competitiveness.

Additionally, the CBDT requested info on peculiarities of TDS’s implementation, including identifying counterparties’ residency, valuing assets in volatile markets, and reconciling peer-to-peer trades.

If further asked, whether the TDS implementation should vary across retail investors, institutional players and market makers.

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Japan Joins Asian Crypto Push With Its Yen Stablecoin Launch

Japan’s Financial Services Agency (FSA) is reportedly planning to give a green signal to Tokyo-based fintech firm, JPYC, approving the country’s first yen-backed stablecoin.

According to a Nikkei Asia report dated 18 August 2025, JPYC is expecting regulatory clearance by fall this year, paving the way for the issuance of  ¥1 trillion ($6.78 billion) in stablecoins over the next three years.

This move is in line with Japan’s 2022 Payment Services Act, which formally recognised fiat-pegged tokens as Electronic Payment Instruments.

Japan moving toward a yen stablecoin while China explores a digital yuan-backed coin shows how Asia is racing to lock influence in the next era of money. Beyond payments, these coins could reshape trade flows and set new standards for global stablecoin regulation.

— The External Range Trader (@official_Ert) August 22, 2025

In Japan’s case, liquid assets such as bank deposits and government bonds will back its stablecoin, unlike algorithmic or crypto-backed stablecoins, which maintain stability via smart contracts and supply-demand algorithms.

JPYC designed the Yen-backed stablecoin for international remittances, corporate transactions, and decentralised finance (DeFi), signalling a push by the powers that be in Japan for the integration and mainstreaming of blockchain-based solutions.

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Singapore’s DBS Bank To Tokenise Structured Notes On Ethereum

Singapore’s largest financial institution, DBS Bank, released a presser on 21 August 2025,  announcing its digital strategy of tokenising structured notes on the Ethereum Blockchain.

Structured notes are traditionally a complex investment product tailored for institutional investors. With DBS Bank’s decision to tokenise them on Ethereum, these notes will now be available in fractionalised, $1000 units, making them more accessible and easier to trade.

The first batch of tokenised notes will be linked to crypto performance, offering payouts with crypto’s price rise while integrating mechanisms to cushion potential losses.

$BMNR, $SBET, $ETH
DBS bank will tokenise structured notes on Ethereum blockchain due to huge growing volume of traded crypto options and notes (+60% from Q1 to Q2 2025). ‘Asset tokenisation is next frontier of financial market infrastructure’ -per Li Zhen/ Head of GFM, DBS

— Eliworld (@Eliworld362190) August 21, 2025

To distribute these tokens, DBS Bank has partnered with regulated platforms including ADDX, DigiFT and HydraX, ensuring only accredited and institutional players can participate.

Further, the bank revealed its plans to expand tokenisation beyond crypto-linked notes to include equity and credit-linked structured products.

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Kyrgyzstan Urges US, UK To Reconsider Crypto Sanctions

Kyrgyzstan has pushed back against recent UK sanctions targeting several of its crypto firms allegedly linked to Russian financial networks.

According to a Reuters report, the country’s president, Sadyr Japarov, appealed directly to the leaders in the US and UK, stating that the imposed sanctions unfairly penalise Kyrgyz firms and politicise economic activities.

The UK’s sanctions focused on firms associated with the A7A5 stablecoin, pegged to the Russian Ruble, which moved over $9 billion in just four months and is available on Ethereum and Tron.

Russian Sanction Evasion Through Kyrgyz Crypto

According to a new report, Russian entities are reportedly using Kyrgyzstan's crypto industry to dodge international sanctions. X conversations highlight regulatory loopholes as a major concern, with calls for tighter controls. This…

— AI News Swarm (@AINEWS_Swarm) July 26, 2025

The sanctioned firms include Grinex and Meer, which analysts believe are successors to Russia’s sanctioned firm Garantex.

While the country has aggressively expanded its crypto sector, issuing over 100 VASP (Virtual Asset Service Provider) licenses and appointing Binance’s founder Changpeng Zhao as an adviser, Western officials and blockchain analytics firms like TRM Labs believe that criminals increasingly utilise Kyrgyz platforms to funnel illegal funds back to Moscow.

Furthermore, authorities believe that the perpetrators often transfer the illegal funds back using the same infrastructure and personnel as previous sanctioned entities

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Key Takeaways

• India consults industry insiders to reform its crypto tax policies
• Kyrgyzstan has pushed back against sanctions levied on its crypto platforms by the UK
• Japan is set to launch its Yen-pegged stablecoin this fall
• Singapore’s DBS Bank will start tokenising structured notes on Ethereum for institutional players

The post This Week In Crypto Asia: India’s Crypto Tax Reforms, Japan’s Stablecoin Push, And DBS’s Tokenization Drive appeared first on 99Bitcoins.