It seems we have reached a crossroads around how cryptocurrencies will be regulated moving forward. US watchdogs are taking one path, while their counterparts in the UK, Europe, and Asia appear to be accelerating in the other direction.
Within weeks of taking office, Trump has already set in motion plans to ease how digital assets – including cryptocurrencies and stablecoins – are regulated across the US. The latest is that the SEC’s new leadership has established a taskforce to overhaul how crypto is governed, with Trump expected to issue executive orders that would lessen regulatory scrutiny of the space and potentially promote wider adoption of digital assets. He also last week moved to establish a strategic bitcoin reserve using government-owned tokens.
The potential for Trump’s second term to disrupt the Basel III Endgame implementation in the US could have far-reaching consequences, too. The framework was set to include standardized disclosures for banks’ cryptocurrency exposures, but the prospect of it being introduced in January 2026 now seems dubious. According to media reports, Trump-appointed regulators will review the US Basel III ‘endgame’ proposals, potentially scrapping the planned changes altogether.
Authorities outside of the US, however, seem to be taking the opposite approach to regulation, introducing more stringent requirements for firms issuing and trading digital assets. Just take the recent implementation of MiCA in the EU, for example. Touted as crypto’s answer to MiFID requirements, the regulation provides a uniform legal framework for the issuance of crypto-assets and the provision of related services. It also requires issuers and crypto-asset service providers to disclose sustainability metrics, potentially raising awareness among retail investors around the energy consumption of their investments. This may bring enhanced transparency to the space, as well as more robust investor protection.
In addition, almost simultaneously, the UK’s Financial Conduct Authority last year announced a vast new framework for regulating digital assets, aimed at providing more clarity for British firms operating in the sector. Regulators farther afield are also doubling down on digital assets regulation. The Securities and Futures Commission of Hong Kong has announced it will expand its workforce in 2025 to add more positions dedicated to ‘virtual asset regulation’, with a 7.2% increase in its budget also largely due to the focus on crypto regulation. Meanwhile, the Crypto-Asset Reporting Framework is a global initiative developed by the OECD to establish standardized reporting requirements for digital currency transactions, aimed at enhancing tax transparency and combatting tax evasion in the space.
For global financial institutions looking to establish a foothold in the digital assets market, the growing divergence between leading markets authorities will pose challenging and pressing questions. How should a firm operating across multiple jurisdictions tackle compliance, for instance? What about each territory’s unique tax obligations? Must each geographic region work in isolation, given these nuances?
Amid such complexity, the most important first step firms must take is to ensure they have a comprehensive, real-time understanding of the global regulatory landscape as it evolves. This ultimately hinges on data. Just as meteorologists require an immense amount of data to determine the forecast, so will firms need a wealth of sophisticated data to decide how best to navigate their regulatory requirements in each market.
Indeed, at this regulatory crossroads for crypto, data represents the guiding star for global firms. Those with access to the most advanced data services will be best equipped to lead the way, while those without fumble in a labyrinth of compliance.
By Stefano Chierici, Senior Product Manager, Financial Information, SIX
