Japan’s Financial Watchdog Launches Antitrust Probe into AI Search Engines - Could This Spark a Crypto Regulation Rethink?
Japan's Financial Services Agency (FSA) just dropped a regulatory hammer—and it's aimed squarely at the algorithms powering AI search engines. The probe targets potential antitrust violations, questioning whether these digital gatekeepers are playing fair in the data economy.
Gatekeepers Under the Microscope
This isn't about slapping wrists. The FSA is digging into whether AI-driven search platforms are leveraging their position to stifle competition—locking out smaller players, manipulating visibility, or creating walled gardens that choke innovation. Think of it as a digital-age trust-busting operation.
The Crypto Connection
While the probe focuses on AI search, the implications ripple straight into crypto. Decentralized finance thrives on open access and transparent protocols—everything these potential antitrust violations threaten. If regulators can rein in centralized AI gatekeepers, it sets a precedent for protecting decentralized ecosystems from similar power grabs.
Why TradFi Should Sweat
Here's the kicker: traditional finance relies on these same gatekeepers for data aggregation and market access. If the FSA finds foul play, it exposes the fragility of relying on centralized tech giants for critical infrastructure. Meanwhile, crypto's decentralized alternatives—from blockchain oracles to on-chain data feeds—start looking less like speculative toys and more like essential hedges against systemic risk. A cynical take? This probe might just highlight how much traditional finance pays in 'convenience fees' to the very platforms now under investigation.
Bottom line: Japan's move signals a regulatory awakening to digital monopolies. For crypto, it's a potential validation of decentralization's core promise—and a reminder that in the race for financial sovereignty, sometimes the biggest opportunities emerge when legacy systems face scrutiny.
The probe is to be conducted as an extension of the 2023 investigation
AI-powered search engines can understand questions asked in a conversational tone and respond accordingly. The AI generates summarized answers from data collected through the internet. The technology is regarded as more convenient than traditional search engines because it provides more direct answers.
However, the unauthorized use of articles from news organizations and other sources by tech companies in their responses has become a problem. News agencies generate revenue by displaying ads on their sites, so the spread of AI-generated news summaries could lead to a decline in that income.
Besides the search engines, conversational AI operators such as OpenAI, which runs ChatGPT, and Perplexity AI Inc., a US startup, are part of the problem. The decision comes amid a series of lawsuits and protests against Perplexity by Japanese news organizations over a conversational AI service. They claim copyright infringement and raise concerns that the system uses news articles without permission.
Two years ago, the watchdog published a report on contracts for the internet distribution of news by major IT companies. It warned that one-sided contract changes that significantly lower payments to news organizations for their articles are a violation of the antimonopoly law. To that end, the latest probe will be conducted as an extension of the 2023 investigation.
The EU and UK tighten their rules against US tech companies
Similar investigations have been launched overseas into AI search services. Earlier this month, the European Commission launched a formal antitrust investigation into Google’s use of publisher and YouTube content to train its generative AI systems, including AI Overviews and Gemini.
The Commission is investigating whether Google’s scraping such content without appropriate compensation or an “opt-out” mechanism breaches EU competition rules. This follows a fine of approximately €2.95 billion imposed in September over anti-competitive practices in its adtech segment.
Google was able to overturn an old AdSense fine of €1.49 billion in late 2024, but that hasn’t stopped the FLOW of new claims. Recently, France’s Autorité de la concurrence confirmed a €250 million fine for violating intellectual property rights. Meanwhile, the UK’s CMA has temporarily granted Google’s advertising arm “Strategic Market Status” (SMS), which will enable stricter oversight in 2026.
Additionally, regulators have opened a new front. The EU began a trade investigation into Meta’s new WhatsApp rules at the beginning of the month, as reported by Cryptopolitan. The probe looks into whether Meta is blocking other AI providers from the WhatsApp Business Solution so that its own Meta AI assistant can be used instead.
Meanwhile, the Office of the US Trade Representative (USTR) accused European regulators of pursuing a “persistent course of discriminatory and harassing lawsuits, taxes, fines, and directives against US service providers.” The TRUMP administration says if these practices continue, the US is prepared to impose fees and restrictions on European companies operating in the American market.
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