Elliptic: 2025 as a Turning Point for Global Crypto Regulation

Global Crypto Regulation Review by Elliptic: 2025 as a turning point for global crypto regulation, marking a shift from targeted enforcement actions to full-fledged legislative and supervisory frameworks, a transition by the United States toward a policy of fostering innovation, allowing traditional banks to access cryptoassets in a regulated manner, and the accelerated maturation of stablecoin regimes in a range of jurisdictions from the EU and the United Kingdom to Hong Kong and South Korea.

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Shift in the Regulatory Paradigm and the Role of Stablecoins

Elliptic does a solid job of summarizing what is arguably one of the most pivotal moments in the history of the crypto industry. In its report, they note that in 2025, the United States overhauled federal policy, with the Donald Trump administration advancing and signing the GENIUS Act, the first comprehensive federal regime for stablecoins, as well as pushing forward the CLARITY Act, which is intended to delineate the respective authorities of the SEC and the CFTC in the digital asset market. In parallel, the Department of Justice announced that it was abandoning a strategy of "regulation by enforcement," refocusing criminal prosecution on fraud and the use of cryptoassets in serious crimes, while the SEC created a Crypto Task Force to develop formal rules and dropped several high-profile cases against major players.

At the same time, banking regulators removed key barriers to bank participation: the OCC, the Fed, and the FDIC agreed to reverse prior restrictions, allowing depository institutions to provide custody, stablecoin reserve backing, and other services, provided they apply proportionate risk management. This was accompanied by joint risk management guidance for cryptoasset activities and the expanded use of blockchain analytics for sanctions and AML controls. Against this backdrop, Elliptic notes an increase in institutional participation and a market shift toward a more mature structure, in which digital assets are increasingly embedded into standard banking processes.

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A separate layer of the report is devoted to stablecoins as a key focus of regulation. In the United States, the GENIUS Act established a federal model that requires full reserve backing and differentiates supervision based on capitalization thresholds. Almost in parallel, Hong Kong launched its own licensing regime for stablecoin issuers, with strict requirements on reserves, redemption processes, capital, and AML/CFT, while in the EU, MiCA provisions for issuers and service providers are already in force. Elliptic records that regulators in different regions are converging on a set of core principles: reserve requirements, redemption and transparency standards, and embedded controls against financial crime.

Above national regimes, an international layer is also taking shape. The Financial Stability Board, chaired by Bank of England Governor Andrew Bailey, made oversight of stablecoins a priority in 2025 and, in its October review, pointed to serious gaps and inconsistencies in the implementation of the global cryptoasset framework that create opportunities for regulatory arbitrage. In its sixth targeted update, the FATF acknowledged progress on implementation of the Travel Rule (99 jurisdictions have adopted or are adopting corresponding measures), but at the same time noted that stablecoins account for the lion's share of onchain activity linked to terrorist financing, drug trafficking, and other crimes, and recorded unprecedented levels of crypto theft by North Korea along with tens of billions of dollars in fraud and scam schemes in 2024.

The report also emphasizes that in this environment "soft" standardization is gaining strength. The Wolfsberg Group has issued guidance for major banks on servicing stablecoin issuers, effectively opening the door to banking partnerships where existing AML/CFT frameworks are applied to such counterparties.

"Global coordination on policy objectives and regulatory standards has always been a major challenge... this past year, however, has seen important progress on this front, with growing alignment in particular on standards related to stablecoins."

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Regional Trajectories: From MiCA and the UAE to Hong Kong and South Korea

At the regional level, Elliptic identifies divergent but interconnected trends. In the EU, by the end of 2024, the MiCA provisions for CASPs had come fully into force, and in 2025, member states focused on transitional regimes and licensing, simultaneously using passporting to access the single market. This creates competition among jurisdictions for the status of licensing hub and increases arbitrage risks: some countries offer looser conditions within the common requirements, while others, such as France, have indicated a willingness to restrict passporting rights for players registered in more liberal states. In parallel, European policymakers are already discussing the need for MiCA 2 to cover DeFi, staking, and lending, which currently sit outside the initial regulatory perimeter, and the ECB is accelerating work on the digital euro, publicly considering the possibility of building on Ethereum or Solana as the underlying technology.

In EMEA, the report highlights the UAE and the United Kingdom. In the Emirates, the DFSA, VARA, and the FSRA continue to build a multi-tier architecture: recognition of USDC and EURC in the DIFC, licensing of major providers such as Ripple, updated rules in the Abu Dhabi Global Market, and a ban on privacy tokens and algorithmic stablecoins. This framework makes it possible to separate regimes for different segments of the market while maintaining a generally high standard of investor protection and risk control. In the United Kingdom, the Labour government, through HM Treasury, is advancing the Cryptoassets Order 2025, which formalizes new regulated activities for stablecoin issuers and custody providers, while the FCA is lifting the ban on retail crypto ETNs and tying this to strengthened AML/CFT rules and the financial promotions regime. At the same time, OFSI has published its first Cryptoassets Threat Assessment focused on Garantex, Iranian platforms, and North Korean activity, recommending deeper screening and risk-based monitoring over several "hops" when dealing with crypto transactions.

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In APAC, Elliptic describes a fragmentation of approaches. Australia is trying to catch up with regional peers by combining temporary relief for secondary trading in licensed stablecoins with advisory work on legislation for crypto platforms and custody providers, to bring them under AFS licenses and beyond pure AML/CFT supervision. In Hong Kong, 2025 is characterized as a shift from policymaking to implementation: through the Stablecoins Bill and HKMA guidance, a full regime is being built for issuers, including requirements on reserves, capital, redemption, risk management, and AML/CFT, while the SFC, via ASPIRe and consultations on OTC services and custody, is expanding the regulatory perimeter. The report underscores that through a sandbox-based approach and close feedback with banks, Hong Kong is designing a model in which high compliance standards are compatible with institutional demand for tokenization and stablecoins.

Some jurisdictions, by contrast, are betting on strict risk containment and limiting arbitrage. MAS in Singapore is tightening the issuance of DTSP licenses and requires firms operating abroad to wind down or suspend activities if they are domiciled in the country. In China, state bodies are discussing a pilot for yuan-denominated stablecoins against a backdrop of widespread illegal use of USDT and competition with the dollar stablecoin ecosystem. In South Korea, following the election of Lee Jae-myung's administration, the government is accelerating legislation on won-backed stablecoins and the approval of ETFs, while the Bank of Korea has suspended its retail CBDC pilot, stressing the need to gradually bring private stablecoins under close supervision. In Thailand, the regulator has for the first time approved USDT and USDC for domestic use, while in Vietnam, a basic law on digital assets focusing on AML/CFT requirements for local platforms will come into force in 2026, tied to the country's goals of exiting the FATF "grey list."

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Conclusion

The picture Elliptic draws reflects not just a proliferation of crypto-related rules, but the emergence of a multi-layered ecosystem in which stablecoins are becoming one of the central test cases for interaction between national regimes and international standards. In this sense, we are seeing not only how rapidly the regulatory map changed in 2025, but also which benchmarks for compliance maturity will define the competitiveness of market participants in the global crypto landscape in the years ahead. Get more insights from our guides for beginners and professionals, and stay tuned for the latest updates and opportunities in the new economy, crypto industry, and blockchain developments!