What Are Crypto Assets? Differences from Virtual Currency, Types & How to Get Started [2026]

Want to know what crypto assets are? Crypto assets are digital assets that can be exchanged over the internet. You've probably heard of "Bitcoin" and "Ethereum" in the news recently—they're types of crypto assets. But many people feel like it's "too complicated to get into."

This article explains the basics of crypto assets in plain language, without technical jargon. Let's get your first roadmap to stepping into the world of crypto assets.

What you'll learn in this article

✅ How crypto assets work and the legal difference from "virtual currency"

✅ Specific differences from fiat currencies (yen, dollars) explained with a comparison table

✅ Types and features of major crypto assets like Bitcoin and Ethereum

✅ Steps to get started, from opening an account to making your first purchase

✅ Risks beginners should watch out for, including price volatility, scams, and taxes

Let's start with the most important point. In the simplest terms, crypto assets are...

Special digital assets that can be used in the world of the internet.

They are different in nature from the Japanese yen in your wallet or the money in your bank account.

How Crypto Assets Differ from Regular Money

There are several key differences:

1.No banks needed
Regular money like the Japanese yen is issued by the Bank of Japan and transactions are managed by banks. However, many crypto assets have no "central authority" like a specific country or company. Computers around the world cooperate to manage transaction records. This system is called "blockchain." A key feature is that individuals can easily transact directly with each other over the internet.

2.Easily crosses borders
When traveling abroad, you need to exchange yen for the local currency. But with some crypto assets, as long as you have an internet connection, you can send money to anyone in the world quickly and with low fees.

3.Many different types
Just as there are various currencies like dollars and pounds when you go abroad, there are many types of crypto assets. The most famous is "Bitcoin," but there are many others like "Ethereum," each with unique characteristics.

What You Can Do with Crypto Assets

• Shopping: While still limited, more and more stores and services are accepting crypto asset payments.
• Sending money: You may be able to send money to friends and family overseas faster and cheaper than through a bank.
• Store of value: Some people hold crypto assets expecting their value to increase in the future. However, values can also decrease, so caution is needed.
• Receiving airdrops: You may be able to participate in "airdrops" where projects distribute crypto assets for free.

"Crypto assets" and "virtual currency" actually refer to the same thing. Originally called "virtual currency" (仮想通貨) in Japan, the official legal name was changed to "crypto assets" (暗号資産) with the revision of the Payment Services Act in May 2020.

The reason for the name change was that the word "virtual" (仮想) could easily be misunderstood as meaning "not real." Additionally, the term "Crypto Asset" has become the international standard.

What makes crypto assets attractive? Let's explore the reasons they're drawing attention.

1. New Technology Opening Up Future Possibilities

Blockchain technology is expected to be used not only for financial transactions but also for automatic contract execution and secure record-keeping. A future where you can truly own in-game items or manage personal information more securely may be on the horizon.

2. Smoother Flow of Money

International money transfers used to take time and incur high fees. With crypto assets, you may be able to send money directly, quickly, and cheaply via the internet, regardless of banking hours.

3. New Services and Ways to Participate

Crypto assets can be used to support specific projects, or serve as "membership cards" or "voting tickets" for online services. New forms of participation that never existed before are being created through crypto assets.

Crypto assets come with risks as well as benefits. Let's make sure you understand them to stay safe.

1. Risk of Major Price Fluctuations

Like stocks and foreign currencies, the value of crypto assets can go up or down. Prices can fluctuate by tens of percent in a single day, so the golden rule is to start with "surplus funds you can afford to lose."

2. Importance of Security Management

Since crypto assets are digital, managing your IDs and passwords is extremely important. If someone learns your password, your precious crypto assets could be stolen. Set complex passwords and never share them with anyone.

3. Watch Out for Scams

If someone approaches you with promises like "guaranteed profits" or "get rich quick," it's very likely a scam. Because the crypto world is still new, scams targeting inexperienced people are rampant. If something seems suspicious, immediately consult someone you trust or the Consumer Hotline (188).

4. Don't Forget About Taxes

If you make a profit from selling or exchanging crypto assets, you need to file a tax return in Japan as "miscellaneous income." If your annual profit exceeds 200,000 yen, it becomes taxable. Don't forget to file your taxes when you make a profit.

There are many types of crypto assets, but here are three of the most well-known.

1. Bitcoin (BTC)

Bitcoin is considered the pioneer of all crypto assets. Sometimes called "digital gold," it has the largest trading volume and market capitalization among all crypto assets. Learn more at "What is Bitcoin?"

2. Ethereum (ETH)

Ethereum is the second most well-known crypto asset after Bitcoin. Its standout feature is the ability to run programs called "smart contracts" that automatically execute agreements. Think of it like a "vending machine that automatically pays out when conditions are met"—this mechanism can be applied to various uses across the internet.

3. Stablecoins

While Bitcoin and Ethereum experience significant price fluctuations, stablecoins are crypto assets designed to maintain a value pegged to fiat currencies like the Japanese yen or US dollar. Because their price remains stable at roughly "1 coin = approximately 1 dollar," they're used for temporarily parking funds or making trades at a stable value within the crypto world.

For those who are now interested in crypto assets, here are the basic steps to get started.

Step 1: Open an Account at a Crypto Exchange

First, create an account at a domestic crypto exchange registered with the Financial Services Agency (such as Coincheck, bitFlyer, or GMO Coin). You'll need to submit identity verification documents (driver's license or My Number card).

Candy Drops is running a collaboration campaign with the FSA-approved crypto exchange "OKJ." By registering through this link, you are guaranteed to receive 1,000 yen worth of Bitcoin.

Furthermore, by completing KYC and verifying your tasks through the Candy Drops My Page, you can earn 50,000 Candy Drops points, which can be used to enter regularly held campaigns.

Don't miss this opportunity to join!

Step 2: Deposit Japanese Yen

Once your account is set up, deposit Japanese yen to the exchange via bank transfer or convenience store payment. It's recommended to start with a small amount (around 1,000 to 5,000 yen).

Step 3: Purchase Crypto Assets

Once your deposit is reflected, select the crypto asset you want to buy (such as Bitcoin) on the exchange screen, specify the amount, and make your purchase. For beginners, buying through the "marketplace" (販売所) is the simplest and easiest to understand.

Note: Always invest with surplus funds and avoid putting in a large amount all at once.

Q. Can I start with a small amount?

Yes, you can. At most domestic exchanges, you can purchase crypto assets like Bitcoin starting from as little as 500 to 1,000 yen. It's recommended to start with an amount you're comfortable with.

Q. Are crypto assets safe?

The underlying technology of crypto assets (blockchain) has high security, but risks such as exchange hacking and scams do exist. By using FSA-registered exchanges and implementing strong password management and two-factor authentication, you can enhance your security.

Q. Do I have to pay taxes on crypto asset profits?

Yes, you do. In Japan, profits from selling or exchanging crypto assets are classified as "miscellaneous income," and you must file a tax return if your annual profit exceeds 200,000 yen. The tax rate can be up to 55% (including resident tax) depending on your income.

Q. Are "crypto assets" and "virtual currency" different things?

They're the same thing. With the revision of the Payment Services Act in May 2020, the official legal name was changed from "virtual currency" (仮想通貨) to "crypto assets" (暗号資産). Internationally, "Crypto Asset" has also become the standard term.

Thank you for reading this far.

Crypto assets are "digital assets that can be exchanged over the internet" — a new system that enables transactions without a central authority like a bank. Legally, they refer to the same thing as "virtual currency," with the official name changed in 2020.

Let's review today's key points:

• Crypto assets are digital assets that can be used on the internet
• There are many types, including Bitcoin, Ethereum, and stablecoins
• Due to high price volatility, it's important to start small with surplus funds
• Tax filing is required when you make a profit

To learn more about crypto assets, check out these related articles:

• What is Bitcoin?
• What is an Airdrop?