Japan has been building one of the world’s most comprehensive regulatory frameworks for digital assets under the oversight of the FSA. | Source: Pexels Key Takeaways Starting October 31, ByBit will halt onboarding of Japanese users to align with the country’s evolving guidelines. The Financial Services Agency has been ramping up regulation this year. After a $1.5 billion hack in February, Bybit has been doubling down on third-party audits. Crypto exchange Bybit has announced it will suspend new us ...

Core Insights - The Financial Stability Board (FSB) has identified "significant gaps" in the regulation of rapidly growing crypto markets, which could pose risks to financial stability [1][2] - The FSB's review indicates that while some progress has been made, the international implementation and coordination of crypto regulations remain fragmented and insufficient [2][4] - The global crypto market has doubled in value to $4 trillion over the past year, raising concerns about financial stability risks, although they are currently assessed as limited [2][3] Regulatory Framework - The FSB highlights a lack of comprehensive regulatory frameworks for stablecoins, which are increasingly connected to the traditional financial system [4][5] - The stablecoin market has grown by nearly 75% over the past year, reaching just under $290 billion, with expectations for continued growth due to new U.S. regulations [5] - The FSB reviewed the implementation of crypto and stablecoin recommendations across 29 jurisdictions, including the U.S., EU, Hong Kong, and the UK, although the U.S. only participated in the stablecoin aspect [5][6] Need for Cooperation - The FSB emphasizes the necessity for improved global cooperation and coordination among jurisdictions to address the risks associated with crypto assets [6]

Nigel Farage has pledged to slash crypto taxes and establish a UK Bitcoin reserve if elected. Reform UK’s leader declared at the Digital Asset Summit in London on Monday that “when it comes to your industry, when it comes to growth in this industry, then I am your champion.” The proposed legislation would reduce the capital gains tax on crypto investments from 24% to a flat 10% and mandate that the Bank of England establish a Bitcoin reserve using approximately £5 billion worth of Bitcoin currently held f ...

Core Viewpoint - The Bank of England (BoE) has declared that stablecoins used for payments in the UK must be regulated like traditional bank money, requiring depositor protections and access to central bank facilities [1][2][3]. Regulatory Stance - The BoE's announcement represents a significant escalation in its regulatory approach, prompting the crypto industry to reassess its strategies [2]. - Bailey's comments indicate a fundamental shift in the BoE's perspective on the relationship between crypto and traditional finance, emphasizing the need for depositor insurance and resolution schemes for stablecoins [3][4]. Future Framework - The BoE plans to publish a consultation paper on stablecoins, potentially establishing one of the most comprehensive regulatory frameworks for stablecoins outside the U.S. [4]. - There is a possibility of banks and stablecoins coexisting, suggesting a potential restructuring of financial transactions within the UK economy [4]. Industry Response - Concerns have been raised by crypto industry figures regarding the BoE's cautious approach, particularly about proposed caps on stablecoin holdings and the criteria for determining which stablecoins fall under its regulation [5]. - The timing of the BoE's announcement is critical, as stablecoins have gained popularity, especially following the U.S. GENIUS Act, which sets federal rules for stablecoins [6].

Core Insights - Gemini is expanding globally following its stock market debut in September, with recent launches in Australia and Europe [1][6][7] Group 1: Expansion Efforts - Gemini has registered with AUSTRAC to accept AUD deposits and has integrated with Australia's payment systems, Osko and NPP [2] - The company has introduced new AUD trading pairs, eliminating the need for SWIFT and international transfer fees [3] - A MiCA license from Malta's financial regulator allows Gemini to operate across the EU under a unified regulatory framework [8] Group 2: Stock Market Performance - Following its IPO on September 12, Gemini's stock experienced a significant decline, dropping 14% on September 16 and another 10% the following day [4] - The stock price fell from a high of $32.5 on September 15 to below $25 for nearly a month, although it has shown some recovery recently [4] - In contrast, other crypto IPOs like Circle and Figure Technologies have performed better, with Circle's stock up over 100% since its IPO and Figure Technologies rallying more than 36% [5]

Core Viewpoint - The Financial Conduct Authority (FCA) has lifted its ban on crypto exchange-traded notes (ETNs), but UK retail investors still face delays in accessing them, highlighting flaws in the regulatory process [1][2]. Regulatory Delays - The FCA had announced the ban's lift on October 8th, but operational details with the London Stock Exchange (LSE) are still being finalized, potentially delaying the first listings to October 13th or later [2]. - Critics argue that the FCA has had ample time since June to coordinate with the LSE, yet delays persist, leaving UK investors unable to access a market available to their European and American counterparts [3]. Market Dynamics - Crypto ETN trading volumes in London account for only 0.59% of total European activity, averaging £624,000 per day, while European exchanges handled €26 billion in crypto ETN trading in 2024 [5]. - The UK is perceived to be lagging in the global crypto market, with frustrations growing among retail investors as Bitcoin prices surge [4][5]. Industry Perspectives - Despite the frustrations, some industry leaders view the lifting of the ban as a positive step towards innovation, noting significant demand for regulated crypto products in the UK [7]. - A notable statistic indicates that 12% of UK adults already hold crypto directly through unregulated platforms, suggesting a strong interest in regulated options [7].

Core Insights - The Russian Central Bank plans to conduct a large-scale audit of the nation's crypto holdings and transactions in early 2026, reflecting its growing attention to the risks and opportunities in the crypto space [1][2][3] Group 1: Audit and Review Plans - The Central Bank will review individual investments in digital financial products tied to cryptoasset prices, likely focusing on crypto derivatives launched on the Moscow Exchange [2][3] - A survey will be conducted over the first two months of 2026 to assess the volume of investments in cryptocurrencies by regulated entities, including for risk hedging purposes [3] Group 2: Regulatory Environment - The Central Bank and the Ministry of Finance have differing views on crypto policy, with the Ministry seeking to regulate and tax the industry while the Bank prefers to restrict crypto's role in the economy [4] - The information from the upcoming survey is expected to help form regulatory policy aimed at legalizing the market to generate tax revenue [5] Group 3: Current Market Dynamics - The Central Bank has ordered the Moscow Exchange and commercial banks offering crypto derivatives to provide monthly reports on transactions and volumes [3] - There are indications that several companies are engaging in direct crypto-powered trade with international partners [7]

Core Insights - The recent week has been pivotal for U.S. crypto regulation, characterized by high-level discussions, new investigations, and significant policy proposals, indicating a shift towards greater regulatory cooperation while uncertainties remain in custody and compliance [1] Regulatory Developments - SEC Chair Paul S. Atkins emphasized that the focus is on "harmonization, not merger" between the SEC and CFTC, ensuring both agencies maintain independence while collaborating on crypto oversight [2] - House Republicans initiated an investigation into the deletion of text messages from former SEC Chair Gary Gensler, raising concerns about transparency and compliance within the SEC [3] - The SEC clarified that state-chartered trust companies can temporarily act as crypto custodians, providing short-term certainty for investment advisers and funds while leaving long-term issues unresolved [4] - CFTC Commissioner Caroline Pham announced the end of the rivalry between the SEC and CFTC, highlighting a new era of cooperation in regulatory efforts [5] Innovations in Crypto Trading - The SEC is reportedly developing a framework to enable U.S. stocks to trade on blockchain technology, allowing shares of major companies to be represented as digital tokens, which has garnered support from fintech firms but faced resistance from traditional Wall Street institutions [6]

Core Insights - India is intensifying its crackdown on crypto exchanges, issuing notices to 25 platforms for anti-money laundering (AML) compliance violations [1][2] - The Finance Ministry confirmed that these exchanges must withdraw their apps and websites from public access in India [1] - The affected exchanges manage billions in user assets, with 14 of them generating over $22 billion in trading volume in the last 24 hours [1] Regulatory Environment - India's AML enforcement against offshore crypto platforms reflects a tightening policy stance, despite the absence of a comprehensive digital asset framework [2][3] - The Finance Ministry has mandated virtual asset service providers (VASPs) to register with the Financial Intelligence Unit-India (FIU-IND) under the Prevention of Money Laundering Act (PMLA) [2] - The Reserve Bank of India (RBI) has expressed concerns about the difficulty of effective regulation, leading to a preference for partial oversight [3] Taxation and Compliance - Heavy taxation, including a 30% tax on profits and a 1% tax deducted at source on transactions, has significantly reduced domestic trading volumes [3] - Over 50 crypto exchanges have registered with FIU-IND, indicating a trend towards rising compliance among global exchanges [4] Enforcement Actions - Major exchanges like Binance, Coinbase, KuCoin, and OKX have faced enforcement actions, with some, like OKX, exiting the Indian market [5] - Exchanges that comply with local regulations, such as paying fines and registering with FIU, have been allowed to resume operations [5] Market Impact - Officials estimate that Indians hold approximately $4.5 billion in digital assets, with strict regulations limiting risks to the broader financial system [6]

Core Insights - Crypto.com has become the first American crypto exchange to secure a complete set of licenses from the U.S. Commodity Futures Trading Commission (CFTC), enabling it to offer a full range of derivatives services to users [1][8]. CFTC Licensing Framework - The CFTC regulates derivatives markets through three core categories of licenses: Futures Commission Merchants (FCMs), Designated Contract Markets (DCMs), and Derivatives Clearing Organizations (DCOs) [2]. - FCMs act as brokers between customers and futures markets, while DCMs are licensed exchanges where futures and options are traded, requiring a clearinghouse for operations [3][4]. Crypto.com's Regulatory Journey - Crypto.com obtained initial DCM/DCO registrations in March 2022 through the acquisition of Nadex, which allowed only 100% collateralized positions without leverage [5]. - The recent amendment permits Crypto.com to offer margined futures to American users, marking it as the first retail-focused exchange to do so [6][8]. Market Context - The CFTC's crackdown on unregistered exchanges in the mid-2010s led to a significant reduction in available derivative products in the U.S. market, with the CME Group initially holding a monopoly on regulated margin contracts for Bitcoin and Ether [9].