Bitcoin and Cryptocurrencies
A Hedge for Inflation
What is Bitcoin
Together with blockchain technologies, Bitcoin and the cryptocurrency space have risen into the mainstream over the last few years. Initially used and promoted primarily by tech enthusiasts, it now is backed by serious money from major financial institutions, with some countries even declaring it legal tender.
At a time when most major economies are printing money in large amounts, many view Bitcoin as a way to hedge against rising inflation and increasing monetary controls from governments.
Investing in Bitcoin and Ethereum
Although many like cryptocurrencies for their decentralized nature and other advantages over fiat currencies, for most average investors, their main reason for interest in this space is the asset’s increase in value over the last decade. While the cryptocurrency space is exceptionally volatile, the returns for those who can stomach the ups and downs can be very appealing.
Holding and investing in the crypto space for those who simply want the long-term returns can be challenging and cumbersome, with issues such as how best to hold the asset safely posing difficult questions.
For crypto investors in Japan, the issues continue with Japan’s hardline tax treatment of the asset, where gains on your crypto currencies can be taxed at rates as high as 55% (see our article to learn more).
Investing the Smart Way
For clients looking to simply have a stake in this growing asset class and benefit from potential long-term returns, holding the asset through crypto-related funds and ETFs may be a better way.
Through Argentums Active Portfolio Management Service, we can introduce Bitcoin and Blockchain funds as an additional part of a lump sum structured investment portfolio. This allows you to invest in cryptocurrencies in a tax-efficient manner and diversify your overall risk.
Talk with one of our Advisors to learn more about the individual requirements and minimum investment amounts you need to take advantage of this opportunity.
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Frequently Asked Questions
Why invest in cryptocurrencies through ETFs instead of holding crypto directly?
Investing in cryptocurrencies through ETFs offers a more structured and familiar way to gain exposure to assets like Bitcoin and Ethereum. ETFs are regulated investment products that remove the need to manage private keys, wallets, or exchanges, and they integrate seamlessly into traditional investment accounts.
For many investors, ETFs provide a simpler, more secure, and easier-to-manage approach to crypto exposure, while still allowing participation in the long-term growth potential of the asset class.
Can Bitcoin and Ethereum ETFs reduce the tax burden compared to holding crypto directly in Japan?
In Japan, gains from directly held cryptocurrencies are currently taxed as miscellaneous income, which can result in tax rates of up to approximately 55%, depending on your income level.
By investing through ETFs held within appropriate investment structures, it may be possible to achieve more favorable tax treatment compared to direct crypto holdings. While individual tax outcomes depend on personal circumstances, ETFs can offer a more tax-efficient framework for long-term investors living in Japan.
We always recommend confirming your specific tax position with a qualified tax professional.
What are the benefits of using international (offshore) investment platforms for crypto exposure?
International investment platforms are designed with globally mobile investors in mind. They offer portability, multi-currency flexibility, and access to a wider range of investment options than many domestic platforms.
For expats in Japan, offshore platforms can also be more tax-efficient and better suited to long-term planning, particularly when combined with ETF-based crypto exposure. These platforms are structured to remain in place even if you move countries, helping you avoid the need to restructure investments as your residency changes.
Can I invest small amounts regularly, or do I need a large lump sum?
Both options are available. You can invest smaller amounts on a regular basis through monthly contribution plans, or you can invest via a larger lump sum if that suits your situation.
Regular investing allows you to spread your entry points over time, which can help manage volatility and reduce the pressure of investing all at once. This flexibility makes crypto ETF investing accessible to both new investors and those with more capital to deploy.
Are these crypto investment accounts portable if I leave Japan?
Yes. One of the key advantages of international investment platforms is portability. Your account is not tied to your residency in Japan and can usually remain in place if you move to another country.
This makes offshore crypto ETF accounts particularly suitable for expats who expect to relocate in the future, as it avoids the disruption of having to close or transfer accounts when your circumstances change.
What cryptocurrencies can are currently availabe via ETFs?
At present, we support investment in Bitcoin and Ethereum through selected exchange-traded funds (ETFs). These are currently the most established and widely adopted cryptocurrencies, with ETF structures that meet our criteria for accessibility, regulation, and suitability for long-term investors.
As the market evolves and additional regulated options become available, we will continue to review and expand our offerings where appropriate.
