Japan's FSA Urges JVCEA to Strengthen Investor Protection and Self-Regulation

The Japan Financial Services Agency (FSA) has requested the Japan Virtual and Crypto assets Exchange Association (JVCEA) to enhance investor protection and self-regulatory functions. During a July 15 meeting, the FSA expressed concerns regarding crypto exchanges steering users toward high-profit retail sales services rather than exchange-based trading. The regulator emphasized the need for fair business practices, improved UI transparency, and the establishment of robust governance and security audit protocols. Additionally, the FSA plans to conduct threat-based penetration testing (TLPT) for exchanges and collaborate with the Japan Financial Literacy and Education Corporation (J-FLEC) to improve crypto literacy.