Crypto Regulations in Different Countries

Key takeaways:

• 2025 marks a turning point in crypto regulation. What started as a peripheral financial experiment has become a central focus for lawmakers and regulators.
• The GENIUS Act established federal rules for stablecoins, while MiCA created a unified approach to digital assets across the European Union.
• Liberal jurisdictions like the UAE or Singapore leverage crypto to attract investment and boost global competitiveness, whereas stricter ones, like China, focus on capital control and financial stability.
• Even with shared AML/KYC principles, countries vary significantly in licensing, taxation, and enforcement approaches.
• Asia shows contrasting strategies. Japan and South Korea strengthen investor protection, while India curbs risk through high taxation.
• Crypto is being fully recognized within the financial sector and regulators are working to align it with existing compliance and oversight structures.

By 2025, crypto isn’t just on the side anymore - it’s now a big topic for regulators. What started as a niche experiment is now being treated seriously, touching financial stability, consumer safety, and even national competitiveness.

Many regions now have clear rules: exchanges need licenses, stablecoins must hold reserves, AML/KYC checks are standard, and a few countries still ban crypto completely.

Some countries treat crypto like traditional securities for taxes, others actively court crypto businesses, and a handful still block trading entirely. 2025 is a turning point: the U.S. passed its first federal crypto law, the EU fully rolled out MiCA, the UK pushed forward its draft regulations, and the UAE doubled down on becoming a crypto hub. Here’s a closer look at how different regions are shaping the rules—and how uneven the playing field still is worldwide.

What is crypto regulations

Crypto regulations are the rules and laws governments create to manage how digital assets are made, traded, stored, and used. These rules look very different — some governments are open to innovation and try to build supportive frameworks, while others take a stricter approach or even ban crypto entirely. Most regulatory systems are still evolving, constantly trying to adjust to the rapid growth of technology and crypto markets

Global Trends

Several themes stand out in 2025:

• The U.S. GENIUS Act (July 2025) established a comprehensive federal framework for payment stablecoins, including custody/reserve requirements and enhanced AML rules.
• AML/KYC standards (including FATF’s travel-rule guidance) are now widely adopted, requiring licensed VASPs to exchange counterparty data when applicable.
• Advertising restricted. Some regulators now demand risk disclaimers on crypto ads or limit promotions altogether.

To get a clearer picture of how crypto rules differ around the world, it’s helpful to frame them around their core objectives:

Tax Policies

• In the U.S., the IRS treats cryptocurrency as property, meaning gains from sales or exchanges are taxable under capital gains rules.
• India applies a flat 30% tax on crypto gains plus a 1% TDS on transfers, reflecting a cautious approach to speculative assets.
• South Africa taxes crypto profits—but ambiguity in guidance leaves businesses navigating grey zones.

Regulatory Licensing

• The EU’s MiCA regulation, now active, provides a unified licensing structure for exchanges, custodians, and issuers across member states.
• In the U.S., the proposed GENIUS Act (as of 2025) introduces federal licensing for stablecoin issuers, mandating secure reserves.
• The UAE’s VARA (Virtual Assets Regulatory Authority) licenses virtual asset service providers and requires merchant adoption of payment tokens outside free zones.
• Japan and South Korea have reinforced custody and registration requirements, safeguarding user assets under regulatory supervision.

Bans & Restrictive Measures

• China maintains a comprehensive ban on most private crypto activity, while promoting its central bank digital currency.
• Several African nations (Morocco, Algeria, Zambia, Zimbabwe) and Egypt apply bans or severe restrictions.
• Nigeria toggles between warning frameworks and limited permissiveness, resulting in regulatory ambiguity.

Regional Highlights

• Europe & UK: EU member states now operate under MiCA, with Germany and France enforcing rigid investor protections. The UK’s draft Cryptoassets Order extends existing financial laws to digital assets.
• U.S.: GENIUS Act sets federal boundaries for stablecoin issuance; SEC and CFTC have signalled coordination on crypto spot products.
• Asia-Pacific: Japan and South Korea strengthen regulatory guardrails. India retains a heavy tax regime. China remains largely closed to private crypto.
• Middle East & Africa: The UAE positions itself as a regulated hub. Many African states either lack frameworks or apply bans.

Regulating Crypto: Three Contrasting Strategies

Global Crypto Regulation: The GENIUS Act and MiCA Explained

GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins Act ) sets up clear federal rules for how stablecoins are issued and managed in the United States.

Let’s take a look at key provisions:

The Act authorizes "permitted payment stablecoin issuers" to issue stablecoins:

• Subsidiaries of insured depository institutions.
• Federal qualified payment stablecoin issuers.
• State-qualified payment stablecoin issuers.

Issuers have to keep reserves equal to the value of the stablecoins they issue, using safe and easily accessible assets like U.S. Treasury bonds or cash. These reserves must stay in U.S. banks and are checked every month, with the results made public.

Issuers are prohibited from paying interest on stablecoin holdings, engaging in activities beyond stablecoin issuance and related services and rehypothecating reserves.

Stablecoin issuers based outside the U.S. can still operate in the country if they follow equivalent regulations, comply with U.S. laws and register with the OCC

In June 2025 Circle's IPO was a direct result of the regulatory clarity provided by the Act. Issuers are adjusting to the new rules by managing their reserves more carefully and going through regular audits to prove they’re compliant.

MiCA is the first EU law to set clear, continent-wide rules for crypto-assets.

The regulation lays out one clear framework that applies to both crypto businesses and the assets they handle. MiCA makes it much easier for crypto service providers to work across Europe. With a single EU-wide license, a company approved in one country can offer services throughout the EU without juggling multiple national licenses.

The regulation separates different types of tokens. Let’s take a closer look at what each type means:

• Utility tokens let users access to certain platforms or services.
• Asset-referenced tokens (ARTs) are stablecoins whose value is supported by a mix of different assets, that help them stay stable even if one asset fluctuates.
• E-money tokens (EMTs), on the other hand, are linked to a single fiat currency that helps keep their value steady.

Exchange platforms like Kraken, Coinbase, Bybit already obtained MiCA licences. It allows them to grow their presence in Europe. Companies get their licenses, improve compliance, and put stronger protections in place to meet the new rules

The Bottom Line

The regulatory story of crypto in 2025 shows just how far the industry has come in little more than a decade. What began as an unregulated experiment has turned into a sector that governments can no longer afford to ignore. The United States finally passed its first federal law with the GENIUS Act, giving stablecoins a clear legal status. The European Union rolled out MiCA, creating the most comprehensive regional framework to date. The United Kingdom is advancing its own legislative framework, while the UAE has already positioned itself as a global hub with a mix of federal and local rules.

At the same time, regulation remains fragmented. Japan is tightening oversight through its FSA, South Korea is strengthening investor protection while delaying taxes, and India continues to hesitate, worried about systemic risks. Across Latin America and Africa, the picture is equally diverse — from progressive frameworks in Mexico and Brazil to outright bans in Bolivia, Morocco, and Zimbabwe.

What unites all of these jurisdictions is a shift in mindset: crypto is no longer outside the financial system — it is part of it. Regulators are converging on three priorities:

• Ensuring consumer protection and financial stability.

• Bringing exchanges and custodians into the same AML/KYC regime as banks.

• Building specific frameworks for stablecoins and, increasingly, tokenized assets.

Still, the global map of crypto law is far from harmonized. Businesses and investors must navigate a maze of different rules, and the lack of cross-border alignment creates both opportunities and risks.

For now, 2025 stands as the year when the period of regulatory uncertainty ended. The crypto industry is no longer tolerated in the shadows. It is regulated, monitored, and,in some cases, embraced. The road ahead is uncertain, but one thing is clear: digital assets are here to stay, and regulation will continue to shape their future.

Sources

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3. FATF. (2021). Guidance for a risk-based approach to virtual assets and virtual asset service providers. Financial Action Task Force. From https://www.fatf-gafi.org/en/publications/Fatfrecommendations/Guidance-rba-virtual-assets-2021.html
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10. Cointelegraph. (n.d.). Japan crypto regulation overhaul: Securities law update. From https://cointelegraph.com/news/japan-crypto-regulation-overhaul-securities-law
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