Cryptocurrency Regulations Around the World

Cryptocurrency regulations around the world are a complex and rapidly evolving landscape, with different countries adopting vastly different approaches, ranging from outright bans to comprehensive regulatory frameworks and even legal tender status for certain digital assets. The common themes guiding these regulations often include financial stability, consumer protection, anti-money laundering (AML) and counter-terrorism financing (CFT), and taxation.

Here’s a breakdown of the general approaches in key regions:

1. Comprehensive Regulatory Frameworks / Crypto-Friendly Jurisdictions:

European Union (EU): The EU is a leader in comprehensive crypto regulation with its Markets in Crypto-Assets (MiCA) Regulation.

Status: MiCA has been fully applicable across all EU member states since December 30, 2024, with some provisions for stablecoins (e-money tokens and asset-referenced tokens) becoming applicable earlier (June 30, 2024).

Key Aspects: MiCA aims to create a harmonized framework for crypto-assets and crypto-asset service providers (CASPs) across the EU, providing legal certainty and “passporting rights” (allowing a licensed entity in one EU country to operate across the bloc). It sets out requirements for authorization, supervision, disclosure, governance, and capital for crypto firms, and specifically regulates stablecoins, requiring full reserve backing and strict conditions for issuers.

Switzerland: Known as “Crypto Valley,” Switzerland has a permissive but structured approach. It enacted a law on Distributed Ledger Technologies (DLTs) in 2020, allowing for the tokenization of financial instruments and generally being supportive of blockchain innovation. Crypto holdings may be subject to income and wealth taxes.

Singapore: Has established itself as a leading jurisdiction that welcomes cryptocurrencies and innovation. The Monetary Authority of Singapore (MAS) supports the industry’s growth while maintaining strict AML/CFT measures. Singapore’s tax laws are generally favorable, with exemptions for certain digital tokens and clear tax structures for investors and businesses.

United Arab Emirates (UAE): Particularly Dubai and Abu Dhabi, have established comprehensive rules for virtual asset activities, with a focus on investor protection, clear licensing, and legal certainty through bodies like the Virtual Assets Regulatory Authority (VARA). The UAE also maintains high AML/KYC standards.

Canada: Requires crypto trading platforms to register with provincial regulators and comply with AML rules. Crypto investment firms are classified as money service businesses, and digital assets are generally taxed like commodities. Canada also permits cryptocurrency exchange-traded funds (ETFs).

Australia: Considers Bitcoin and other cryptocurrencies as financial assets subject to capital gains tax when traded, exchanged, sold, gifted, converted to fiat, or used for purchases. The Australian Taxation Office requires record-keeping for transactions.

United Kingdom (UK): The UK is undergoing a significant regulatory overhaul to position itself as a global digital finance hub. The Financial Services and Markets Act 2023 brings crypto exchanges and custodians into the regulatory framework, and the Economic Crime and Corporate Transparency Act 2023 empowers law enforcement to freeze illicit crypto assets. The Financial Conduct Authority (FCA) is implementing comprehensive regulations with a phased approach, with the full regime expected by 2026. Marketing rules for crypto promotions are already in effect.

Japan: Was an early adopter of crypto regulation, recognizing Bitcoin as legal property. It has a licensing regime for exchanges and strong consumer protection measures.

Portugal: Known for its “crypto-friendly tax regime” which historically offered exemptions from VAT and favorable tax rates for certain crypto operations, making it an attractive location for crypto entrepreneurs and investors.

Germany: Displays a commitment to supporting a secure and open crypto industry by addressing possible risks and enforcing stringent compliance standards.

2. Countries with Evolving or Strict Regulations:

United States (US): The US has a fragmented and evolving regulatory landscape, with various agencies asserting jurisdiction.

Key Progress in 2025: Congress has made strides toward federal oversight of stablecoins and digital asset markets. The GENIUS Act was signed into law, regulating payment stablecoins by requiring full reserve backing, monthly audits, and AML compliance.

Ongoing Bills: The CLARITY Act (defining digital assets under federal securities and commodities laws) and the Anti-CBDC Surveillance State Act (aiming to block the Federal Reserve from creating a public Central Bank Digital Currency without congressional approval) have passed the House and are pending in the Senate.

Agency Roles: The Commodity Futures Trading Commission (CFTC) has primary jurisdiction over digital commodities, while the Securities and Exchange Commission (SEC) retains authority over digital assets that qualify as securities (e.g., through ICOs). The IRS treats cryptocurrencies as property for tax purposes, meaning transactions may trigger capital gains or losses