Japan to Quadruple AI and Semiconductor Funding to ¥1.23T in 2026 Budget
Japan’s Ministry of Economy, Trade and Industry (METI) will nearly quadruple targeted funding for semiconductors and artificial intelligence to about ¥1.23 trillion (≈$7.9bn) in fiscal 2026, driving an overall METI budget rise of roughly 50% year‑on‑year. The Cabinet under Prime Minister Sanae Takaichi has approved the plan, which moves previously ad‑hoc support into the regular budget to provide stable, predictable funding. Key allocations include ¥150 billion for state‑backed chip venture Rapidus (bringing total public support to ¥250 billion), ¥387.3 billion for domestic foundation AI models, data centers and “physical AI” (robotics/automation), ¥5 billion for critical minerals security, and ¥122 billion for decarbonisation and next‑generation nuclear. The package is coupled with ¥1.78 trillion in special bonds to back export and investment insurance linked to Japan–U.S. investment flows and follows a broader ¥21.3 trillion fiscal stimulus; the government has modestly raised GDP forecasts for the current and next fiscal years. For crypto traders, the announcement signals stronger state support for hardware and AI infrastructure that could lift demand for GPUs, data‑center services and semiconductor supply chains — potentially benefiting tokenized projects, infrastructure tokens or exchanges with exposure to Japan‑based AI and hardware ecosystems. Watch for corporate capex upgrades, procurement contracts, import/exports shifts, and collaboration announcements that may shift sector sentiment and trade flows.
Neutral
The announcement is market‑supportive for hardware and AI infrastructure demand but does not directly target any specific cryptocurrency; its impacts on crypto prices are indirect and dependent on secondary effects. In the short term, the news is unlikely to cause sharp moves in major crypto prices because it primarily affects capital expenditure cycles, semiconductor supply chains and data‑centre demand rather than token fundamentals. Traders may see modest bullish flows into infrastructure‑linked tokens or equities tied to GPUs, data‑center providers and tokenized hardware projects as procurement contracts and corporate capex plans are announced. Over the medium to long term, sustained state spending could strengthen Japan’s AI and semiconductor ecosystems, increasing on‑chain activity for projects that rely on local data centers or hardware (supportive for infrastructure and utility tokens). However, absent direct subsidy or regulatory changes for crypto, price impact on major tokens remains limited — hence a neutral classification.