Publishing Verified Trader Performance — Japan Regulatory Overview

How NakedPnL is positioned in Japan under the FIEA, JFSA supervision, the Payment Services Act crypto-asset regime, and the APPI privacy framework.

NakedPnL operates a public registry of verified investment performance produced by individual traders who voluntarily connect read-only exchange API keys or sign on-chain wallet attestations. Daily NAV snapshots feed a time-weighted return (TWR) calculation; results are recorded in an append-only, SHA-256 chained ledger and Merkle-anchored to Bitcoin via OpenTimestamps so any third party can independently re-verify them.

This page describes how that activity is positioned under Japanese law, with reference to the Japan Financial Services Agency (JFSA), the Financial Instruments and Exchange Act (FIEA, 金融商品取引法), the Payment Services Act (PSA, 資金決済法), and the Act on the Protection of Personal Information (APPI, 個人情報の保護に関する法律).

How NakedPnL is classified in Japan

NakedPnL's activity is the production and distribution of factual performance data. The platform is not registered with the JFSA in any category — not as a Type I Financial Instruments Business Operator, a Type II Financial Instruments Business Operator, an Investment Advisory and Agency Business, an Investment Management Business, or a Crypto-Asset Exchange Service Provider — and does not appear on the JFSA's public register of registered financial business operators.

FIEA Article 28 and the four business categories

Article 28 of the FIEA defines four broad categories of Financial Instruments Business: Type I (sales and dealing in highly liquid securities and derivatives), Type II (sales and dealing in less liquid securities such as collective investment schemes), Investment Advisory and Agency Business, and Investment Management Business. Article 29 makes registration with the Prime Minister (delegated to the JFSA) a precondition for engaging in any of those businesses.

Investment Advisory Business is defined in Article 2(8)(xi) of the FIEA as the giving of advice on the value of securities or investment decisions concerning securities, in return for compensation, under an investment advisory contract. The contract requirement is significant: factual reporting that does not arise under an advisory contract with a specific client is not within Article 2(8)(xi).

NakedPnL does not enter into investment advisory contracts with users. The platform does not provide advice on the value of securities or on investment decisions concerning securities. The same registry data is shown to every reader of a given page. On those facts, the platform's analysis is that the activity does not engage Article 2(8)(xi) FIEA and does not require Investment Advisory and Agency Business registration.

Other FIEA categories

NakedPnL does not handle securities or derivatives transactions on behalf of users (no Type I Financial Instruments Business). It does not deal in collective investment scheme interests, does not solicit subscriptions, and does not act as an intermediary for the same (no Type II Financial Instruments Business). It does not manage any client assets under discretion (no Investment Management Business). The platform's activities sit outside each of those four categories on the platform's own analysis.

Payment Services Act and crypto-assets

The Payment Services Act (PSA) regulates Crypto-Asset Exchange Service Providers (CAESPs) under Article 2(7) of the PSA. A CAESP is a person who, in the course of trade, engages in (i) sale and purchase of crypto-assets or exchange between crypto-assets, (ii) intermediary, brokerage or agency for those activities, or (iii) management of customers' crypto-assets in connection with those activities. Registration under PSA Article 63-3 is required.

NakedPnL does not buy or sell crypto-assets, does not act as an intermediary or broker, and does not manage customer crypto-assets. Read-only API keys and signature-based wallet attestations grant no transactional authority. The platform's analysis is that it is not a CAESP and is not required to register under PSA Article 63-3.

What NakedPnL does not do

• No copy trading. The platform cannot replicate a trader's positions into another user's account. Copy-trading services are likely to engage Type I, Type II, or Investment Management Business registration depending on structure.
• No investment advisory contracts. The platform does not enter into the contract structure described in FIEA Article 2(8)(xi).
• No broker-affiliate links to JFSA-registered or unregistered firms in exchange for fees.
• No investor-trader matching.
• No custody — no Crypto-Asset Exchange Service under PSA Article 2(7), and no securities custody under FIEA Type I.
• No execution. The platform never sends orders to any venue.

These design choices are encoded as feature flags in the codebase and protected by a continuous-integration test that fails the build if any flag is changed.

What Japanese users should know

Japanese users should treat the registry as factual performance data and nothing more. Past performance is not a guarantee of future performance — a phrase the JFSA and the self-regulatory organisations (such as the Japan Securities Dealers Association and the Japan Virtual and Crypto Assets Exchange Association) require registered firms to display alongside past-performance information. NakedPnL applies an equivalent statement on every trader profile.

If a third party offers to manage your money based on a NakedPnL track record, check the JFSA register of Financial Instruments Business Operators or the JVCEA member list (for crypto activities) to verify whether the third party holds the appropriate registration. NakedPnL does not vouch for any third-party manager.

Act on the Protection of Personal Information (APPI)

The Act on the Protection of Personal Information (APPI), as amended in 2020 with effect from April 2022 and further amended subsequently, governs the handling of personal information by Personal Information Handling Business Operators in Japan. The Personal Information Protection Commission (PPC) enforces the regime and issues guidelines.

Lawful bases used by the platform include performance of a contract for users with an account, legitimate-business-purpose reasoning under Article 17 (use of personal information), and explicit consent for the public listing of a trader's handle and TWR series. Data-subject rights of disclosure (Article 33), correction (Article 34), and cessation of use (Article 35) are honoured through the privacy contact. Withdrawing public-listing consent removes the registry entry from public endpoints.

Cross-border transfers of personal data require additional safeguards under APPI Article 28; the platform applies appropriate measures consistent with PPC guidance for Japanese users' data routed across borders.

Tax considerations

Crypto-asset gains in Japan are generally treated as miscellaneous income (雑所得) under the Income Tax Act, taxed at progressive rates that can reach approximately 55% including local inhabitant tax for high-income individuals. Securities trading gains are typically taxed under the separate-tax regime for capital gains. The National Tax Agency (NTA) publishes guidance on cryptocurrency taxation. The platform does not produce NTA-facing statements; users are responsible for their own returns. A zeirishi (税理士, certified tax accountant) admitted in Japan is the right resource for specific questions.

Japan disclaimer variant

Japan is not currently mapped to a country-specific disclaimer variant in lib/jurisdictions.ts. Users in Japan therefore see the default publisher disclaimer, which states that NakedPnL is a publisher of verified data and not an investment adviser, broker, asset manager, or copy-trading platform. A country-specific variant may be added in a future release; this page will be updated accordingly.

Frequently asked questions