Japan's Financial Services Agency on February 19 approved the Financial Review Council's working group report on the fund settlement system. After seven rounds of discussions, the report proposes a new regulatory framework for cryptoasset exchanges and stablecoins. The report recommends that relevant provisions of the Financial Commodities Exchange Law be incorporated into the Fund Settlement Law to strengthen the protection of users in the event of an exchange bankruptcy. At the same time, it proposes to introduce a "ownership system" for cryptoasset transactions, requiring intermediaries to be affiliated with a specific exchange and not to keep user assets. In terms of stablecoin regulation, the report allows issuers to allocate up to 50% of their assets to short-term government bonds and specific time deposits, rather than limited to demand deposits. The regulatory framework has been submitted to FSA official Katsunobu Kato for approval, and the relevant legal development work will start soon.