Japan’s Prime Minister embroiled in a Meme coin controversy: SANAE TOKEN surges 40x then crashes, and a major regulatory crackdown is about to land

Gate News: The SANAE TOKEN incident, where Japan’s political scene and the crypto market intertwine, continues to escalate. The controversy over whether the token received endorsement from Japan’s prime minister is still ongoing, and it is also directly affecting the direction of Japan’s crypto regulation.

The token launched on the Solana chain on February 25, 2026, introduced by NoBorder DAO, and was promoted using the name and image of Japan’s Prime Minister Sanae Takai. Its price surged more than 40-fold on the day it launched, but after on March 2 Sanae Takai publicly denied any connection to the project, the token rapidly crashed by about 58%, dealing a noticeable blow to market confidence.

The incident was then upgraded. According to Japanese media outlet 《Shukan Bunshun》, developer Matsui Ken had reportedly informed the prime minister’s office in advance that the project constituted a crypto asset, and even received positive feedback at the secretary level. This claim conflicts with the official stance of “completely unaware” stated earlier, but as of now, the prime minister’s office has not issued an official response.

Regulators moved quickly to follow up. Japan’s Financial Services Agency (FSA) has launched an investigation into NoBorder DAO, with the focus on its actions of conducting crypto business without a license. At the same time, Japan’s National Diet is deliberating a key bill aimed at transferring crypto assets from the framework of the “Payment Services Act” to that of the “Financial Instruments and Exchange Act,” to enable stricter oversight.

Under the proposed new bill, penalties for unlicensed issuance and sale of crypto assets would be significantly increased. The maximum prison term could rise to 10 years, and the fine cap would be raised to 10 million yen. In addition, Japan’s securities and transaction regulators will for the first time gain criminal investigation authority over the crypto industry, and will strengthen investor protection mechanisms—for example, automatically voiding trades with unregistered entities.

The SANAE TOKEN incident has not only sparked political controversy, but has also become an important catalyst for regulatory upgrades. As the investigation advances and legislative progress continues, compliance thresholds in Japan’s crypto market may rise significantly.