According to the report by professional services giant PwC 40+ countries crafting legislation, establishing licensing regimes, and setting guidelines for stablecoins in 2023 alone with significant inconsistencies and gaps in these efforts.
Four Pillars of Focus
The report identifies four key areas driving regulatory attention:
- Stablecoin Frameworks: Creating guidelines for the increasingly popular stablecoins, designed to peg their value to traditional assets like the U.S. dollar.
- Travel Rule Compliance: Implementing the Financial Action Task Force’s (FATF) travel rule, requiring cryptocurrency exchanges to share customer data for transactions exceeding a certain threshold.
- Licensing: Establishing licensing regimes for cryptocurrency businesses to ensure compliance and consumer protection.
- Listings: Determining which crypto assets can be traded on regulated exchanges.
Uneven Engagement of Regulations
Some countries, like Japan, the Bahamas, and parts of the EU, went all in and tackled all four big crypto rules: stablecoins, data sharing, licenses, and what can be traded. Others, like India, Brazil, and Uganda, played it cool and only focused on one or two things. This shows that different countries have different opinions about how to handle the whole crypto thing.
Travel Rule Takes the Lead
The FATF’s travel rule emerged as the most widely discussed regulation, captivating the attention of 40 out of the 42 surveyed jurisdictions. Establishing stablecoin frameworks, however, garnered less interest, with eight countries, including India, Brazil, and Turkey, not even broaching the subject.
Turkey Stands Alone
Turkey stands out as the sole outlier, failing to make any progress on any crypto-related initiatives at the national level. This paints a stark picture of the diverse spectrum of regulatory engagement across the globe.
Building a Unified Crypto Future
The report underscores the urgent need for greater international cooperation and harmonization in the crypto regulatory landscape. The current patchwork approach creates uncertainty for businesses and hinders the potential for widespread adoption. Curating a unified framework, however, hinges on reaching a consensus on the fundamental nature and risks of cryptocurrencies.
