Global regulators refine crypto approach in Q2 2025

Global financial regulators are refining cryptocurrency approaches in the second quarter of 2025. After the advancement of the US GENIUS Act in May, several jurisdictions stepped up their efforts on the digital assets market, though some have taken opposing approaches to President Donald Trump’s vision.

The crypto market capitalisation currently stands at $2.7 trillion, according to a quarterly report by Coinbase Institutional.

EU’s tightened supervision

In the EU, both central banks and policymakers are closely monitoring the supervisory standards of crypto-asset entities.

Despite the Markets in Crypto-Assets Regulation (MiCA) only taking effect in December, the European Banking Authority (EBA) recently added new supervisory requirements for national authorities through a final technical package published on May 28.

The reporting framework introduced new responsibilities for national authorities overseeing crypto-asset entities, such as asset-referenced tokens (ARTs), e-money tokens (EMTs) and crypto asset service providers (CASPs).

It is centralising crypto-asset prudential disclosure templates into the EBA’s platform Pillar 3 Data Hub (P3DH), while also outlining the authorities’ tasks on risk management, business conduct and the prevention of market abuse. The regime came into force on June 1, 2025.

Regional reputational risks

In the Bank of Italy’s annual report published on May 30, governor Fabio Panetta highlighted the growing concerns among EU central bankers. He expressed in particular concerns over reputational risks emerging from linking the traditional financial system to the world of crypto-assets.

“EU citizens might be exposed to failures of platforms or issuers based in other jurisdictions that lack adequate controls or the necessary transparency and operational safeguards,” said Panetta. “Overall, MiCA offers protection to European savers. However, heterogeneity in regulatory approaches at international level remains a source of risk.”

Enforcement in Southeast Asia

Meanwhile, Southeast Asian countries are tightening their oversight on crypto service providers, and will move to shut down unlicensed crypto exchanges by the end of June.

On June 2, the Monetary Authority of Singapore (MAS) announced that digital token service providers (DTSPs) operating without a licence will be shut down. The regime has no transition period; firms have only until June 30, 2025 to register, after which they will be considered in breach of the law and face penalties.

Singaporeʼs Financial Services and Markets Bill, passed in April 2022, gave the MAS power to regulate crypto firms based in the city-state but operating abroad.

On May 29, the Securities and Exchange Commission, Thailand (Thai SEC) also announced a ban on five crypto exchanges for operating without authorisation. Bybit, 1000X, CoinEx, OKX and XT.COM websites will be blocked in Thailand from June 28, 2025, and users are advised to withdraw funds from the platforms before the deadline.

“The SEC would like to warn the public and investors to exercise caution when using the services of unlicensed digital asset businesses. There is also a risk of being scammed, as well as the risk of being used as a channel for money laundering by offenders,” the Thai SEC said in a statement.

LatAm takes ‘practicalʼ approach

The regulators’ moves sparked a debate about a more “practical” approach to crypto, similar to the regime seen in Latin America (LatAm).

For example, Brazil and Chile centralised all crypto-assets under one umbrella definition. Chile’s FinTech Act defines crypto assets as “digital representations of value, goods or services” and applies this broad definition to all service providers excluding stablecoins.

Speaking at a webinar on June 3, Carolina Veas, partner at law firm CMS Chile, explained: “[Chile] takes a very functional approach regarding crypto. It does not create a standalone regime separate from the FinTech Law. Every crypto asset is part of the financial industry by default, and that’s it. [The approach] is useful; that’s why we have this kind of adoption around LatAm.”

“Having a standalone legal regime for these assets means dealing with more regulatory complexity, which is a challenge. The goal of fintech law, however, is to create more flexibility and help foster greater competition in the industry.”

The UK Financial Conduct Authority (FCA) is also moving towards a more “balanced” regime on stablecoins, proposing relaxed reserve requirements on May 28.