The Japanese government has proposed changes to its foreign exchange regulations in an attempt to prevent Russia from evading financial sanctions by using digital currencies.

The revision 'presumably enables the government to apply the law to crypto-asset exchanges like banks and oblige them to scrutinise whether their clients are Russian sanction targets,' said Saisuke Sakai, senior economist at Mizuho Research and Technologies.

Chief Cabinet Secretary Hirokazu Matsuno said in a press conference that amendments to the Exchange and Foreign Trade Act will be presented to the Japanese parliament on Monday.

Previously, Japan's financial regulatory authority instructed some 30 crypto exchanges in the nation to refrain from conducting transactions with sanctioned targets.