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Japan’s Financial Services Agency (FSA) expressed concerns at a July 15 meeting with the Japan Virtual and Crypto Assets Exchange Association that crypto asset exchange service providers may be steering users toward higher-margin “sales desk” transactions. Building on issues raised in a 2025 Financial System Council report, the FSA linked the discussion to the customer-centric business conduct obligations introduced under the revised Financial Services Provision Act, which took effect in November 2024. The agency indicated it will engage with the industry on whether user interface (UI) design—which influences the choice between sales desks and exchange platforms—allows users to make informed decisions after understanding the differences and cost structures of each option.
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Japan’s Financial Services Agency (FSA) expressed renewed concerns from a user-protection standpoint at a July 15 meeting with the Japan Virtual and Crypto Assets Exchange Association, noting that crypto asset exchange service providers may be steering users toward transactions on “sales desks.” The agency’s position was disclosed in materials published on July 17.
Crypto asset trading services come in two forms: “sales desks,” where the exchange operator acts as the counterparty to orders, and “exchanges,” where orders from users are matched against each other. Sales desks offer intuitive screen navigation and easier order execution, but tend to have wider spreads—the difference between bid and ask prices—compared to exchanges.
At the meeting, the FSA took up the issue of how sales desk and exchange services should be offered, drawing on a 2025 report compiled by the Financial System Council’s Working Group on Crypto Asset Regulation. The report raised concerns that operators offering both services may be encouraging users to trade on sales desks, where spread revenue is easier to generate.
What became newly clear from the materials released this time is that the FSA has tied this issue to the revised Financial Services Provision Act, which took effect in November 2024. The amendment imposes on financial business operators, including crypto asset exchange service providers, an obligation to “conduct business sincerely and fairly toward customers while taking into account the best interests of customers.”
The FSA indicated it will engage with the industry going forward on what constitutes customer-centric practices regarding on-screen navigation—the so-called user interface—that influences whether users choose a sales desk or an exchange. Merely offering both services is not sufficient; the focus will be on whether the design allows users to understand the differences and cost structures of each and make their own informed choices.
Furthermore, regarding the development of self-regulatory rules under the Financial Instruments and Exchange Act, the FSA called for discussion on providing clear explanations of fee and service differences, as well as the appropriate form of the suitability principle, which encourages transactions suited to a user’s knowledge and asset situation.
Since 2016, Japan has progressively built out its regulatory framework for crypto assets, including a registration system for exchange operators and segregated management of user assets. In 2025, as crypto assets have increasingly taken on the character of investment products, full-scale consideration of regulatory reforms centered on the Financial Instruments and Exchange Act has been underway.
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Source: finance.biggo.com