Digital asset regulation accelerates in 2026

For much of the past decade, the global regulatory posture toward digital assets has been defined by uneven progress: clear rules in some markets, uncertainty (and frequent enforcement-by-analogy) in others. In 2025, the tone shifted meaningfully. What changed was not that regulators “solved” digital assets. Rather, more jurisdictions moved from “what” to “how.”

Three key themes repeatedly surfaced: (i) clearer licensing and conduct expectations for intermediaries; (ii) more explicit approaches to digital money (stablecoins, tokenized deposits, and related settlement mechanisms); and (iii) continued efforts to align global standards on prudential treatment and financial-crime controls.

As a result, the landscape is more navigable than it was — but still not fully harmonized. The industry remains early in answering some of the hardest questions. These include how digital assets fit within existing securities and custody frameworks, what “good” looks like for operational resilience, and how cross-border compliance should work in practice.

Emerging clarity across several core pillars in 2025

1. Stablecoins moved closer to the mainstream regulatory perimeter
One of the clearest signals of 2025 was the continued migration of fiat-referenced stablecoins from the periphery toward a regulated product category with defined obligations around reserves, redemption, segregation, and governance. A major milestone in the United States in 2025 was the creation of a federal framework for payment stablecoins through the passage of the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act.¹

In Asia, Hong Kong is an example of a jurisdiction moving from consultation to implementable requirements. The Hong Kong Monetary Authority (HKMA) implemented a stablecoin issuer regime under the Stablecoins Ordinance effective August 1, 2025. The regime explicitly makes the issuance of fiat-referenced stablecoins a regulated activity requiring a license, supported by published guidance and a public register of licensed issuers.²

For institutional users, the value proposition of a stablecoin regime is not ideological — it is operational. It provides clearer expectations around reserves, redemption, disclosures, and permissible issuer types, as well as a more uniform compliance baseline for using stablecoins in payments and settlement contexts.

2. Bank engagement became more “addressable” in the US
In the US, 2025 saw notable steps that — at minimum — reduced ambiguity about the ability of banking organizations to engage in permissible crypto-asset activities in a safe and sound manner. First, US regulatory friction affecting banks’ ability to provide custody services eased with the Securities and Exchange Commission (SEC) rescission of Staff Accounting Bulletin 121 (SAB 121).

SAB 121 required entities that safeguard crypto assets for customers to recognize the fair value of the custodied assets as both a liability and an asset on their balance sheets. This represented a marked departure from the historical treatment of custodied assets as off-balance-sheet items.

The requirement also disproportionately impacted entities subject to prudential capital requirements, such as banks, which are required to maintain capital based on assets included on their balance sheet, thereby increasing the cost of providing custody services. As a result, SAB 121 essentially made it commercially impractical for traditional bank custodians to provide digital asset custody services and thus served as a barrier to entry into the market. Rescission of this requirement was a development that market participants widely viewed as a meaningful reduction in a key obstacle to scaled institutional custody.

Next, the Federal Reserve Board and the Federal Deposit Insurance Corporation (FDIC) jointly announced the withdrawal of prior restrictive interagency joint statements regarding banking organizations’ crypto-asset-related activities.³ These were replaced with a joint statement on guidance for banking organizations on conducting crypto-asset safekeeping,⁴ framing the move as intended to provide clarity that banks may engage in permissible activities consistent with safety and soundness and applicable law.

The Office of the Comptroller of the Currency (OCC) further clarified the scope of national banks’ authority in Interpretive Letter 1184. It confirmed banks may provide and outsource crypto-asset custody and execution services and may buy and sell assets held in custody at a customer’s direction (subject to appropriate third-party risk management and applicable law).

This is precisely the kind of incremental but practical clarity institutions look for: Not a sweeping declaration, but a firmer “how” around the provision of custody, execution, and outsourcing — core building blocks for regulated market participation.

3. Regulatory frameworks outside the US continued to mature
The European Union’s Markets in Crypto-Assets Regulation (MiCA), a harmonized regime for crypto assets not otherwise covered by existing EU financial-services law, became a global reference point precisely because it provides a relatively coherent “end-to-end” structure. It spans from disclosures and issuance requirements to authorization and supervision of Crypto-Asset Service Providers (CASPs), including firms providing custody, trading platform operation, exchange, execution, advisory, and related services.

In 2025, the most important development was the continued maturation of MiCA’s Level 2/Level 3 measures and supervisory tooling, including European Securities and Markets Authority (ESMA) workstreams and public registers that make implementation more tangible for institutions. From an institutional perspective, MiCA’s significance is less about any single rule and more about the direction of travel: greater standardization of expectations for governance, disclosures, and conduct — plus a path toward passporting and supervisory consistency across EU member states.

In December 2025, ESMA issued a statement⁵ emphasizing that transitional regimes are uneven across member states. It set expectations around early engagement with national competent authorities (NCAs) and, for firms not yet authorized, the need for orderly wind-down planning where transitional periods have ended.

Luxembourg’s legislative modernization of the dematerialized securities framework — most notably via “Blockchain Law IV” (which entered into force on December 31, 2024) — began to show concrete, practical effects for tokenized securities and tokenized fund structures. The reforms introduced an optional control agent model for dematerialized securities recorded and transferred using distributed ledger technology (DLT), providing an alternative to the traditional central account keeper model and its top‑of‑chain custody structure.

Under this approach, the control agent maintains the issuance account — the legal anchor for aggregate issuance — while supporting reconciliation and oversight. Securities accounts may be held with third‑party account keepers, enabling more flexible custody chains for DLT‑based instruments. In addition to developments for dematerialized securities, clarity also grew for the use of DLT as the definitive record in the issuance of registered shares in Luxembourg using a digital transfer agent, with several collective investment vehicles offered under this structure in 2025.

In the United Kingdom, 2025 saw tokenization regulation become less abstract — particularly for fund tokenization. The Financial Conduct Authority (FCA) issued “CP25/28: Progressing fund tokenization,”⁶ proposing guidance for operating tokenized funds under a “Blueprint model,” introducing an optional “Direct to Fund” dealing model, and laying out a roadmap with an explicit aim to publish a policy statement in the first half of 2026.

The practical significance here is that the UK is focusing on plumbing and governance questions that institutions care about: control of the register, operational resilience, identity/KYC controls, and how to integrate tokenized fund rails into existing investor protection frameworks. It is also consistent with the market’s broader shift toward hybrid models rather than abrupt replacement of traditional rails with digital rails.

In Japan, the Financial Services Agency (JFSA) published a 2025 discussion paper⁷ examining regulatory systems related to crypto assets — a strong indicator of continued evolution in how Japan approaches classification, disclosures, and market structure. Singapore also advanced its approach to cross-border digital token activities. The Monetary Authority of Singapore (MAS) clarified the scope of its Digital Token Service Providers (DTSPs) regime. From June 30, 2025, DTSPs providing services solely to customers outside Singapore relating to specified digital tokens will need to be licensed. MAS also emphasized that it has set a high bar for licensing and will generally not issue a license for higher-risk models.

For global institutions, the message is consistent: Supervisors are increasingly focused on who is being served, from where, and under what supervisory reach, particularly where cross-border models heighten financial crime and consumer risks.
 

What remains unresolved: The “last mile” problems that still inhibit scale

Even with improved clarity, institutions still face a set of persistent “last mile” issues:

• Prudential alignment remains uneven across jurisdictions, especially as global standards on bank exposures to crypto assets continue to be implemented locally on different timelines. The Basel Committee on Banking Supervision (BCBS) has issued its framework for the prudential treatment of crypto-asset exposures⁸ and industry dialogue has continued around calibration and implementation sequencing.⁹
• Financial crime controls are becoming more robust, but adoption is not uniform. The Financial Action Task Force (FATF) reported in 2025¹⁰ that 99 jurisdictions had passed or were in the process of passing legislation implementing the “Travel Rule” (referring to requirements that certain originator/beneficiary information accompany qualifying transfers), while also emphasizing ongoing challenges around licensing/registration and offshore Virtual Asset Service Provider risk.
• Some friction points are not “crypto-native” at all — they are traditional legal and tax constructs colliding with tokenization workflows. For example, many tokenized products (e.g., tokenized fund shares or other tokenized securities) may sit outside crypto-asset specific frameworks and instead remain governed by existing securities rules — creating interpretive challenges when DLT changes the “how” of issuance, transfer agency, and custody.
   

Areas of continued focus in 2026

Looking ahead, 2026 is likely to be shaped less by brand-new concepts and more by execution, supervision, and interoperability:

1. US market structure and implementation details: Stablecoin rules are a major step, but market structure, custody, and cross-agency coordination will continue to be where clarity is either cemented — or delayed.

2. UK tokenization rules becoming “final form”: The FCA has signaled an intention to move from consultation to policy statement in the first half of 2026; that will be a key milestone for firms building UK-based tokenized fund operating models.

3. Prudential calibration and global consistency: 2026 will likely bring continued focus on how bank capital, liquidity, and exposure limits treat tokenized assets versus their traditional equivalents — with material implications for whether regulated institutions can participate at scale.

4. Operational “glue” — identity, compliance automation, and resilience: As tokenization and digital cash experiments mature, the differentiator becomes the control environment: governance, cyber resilience, AML tooling, and reliable interoperability across rails.
 

The way ahead

The most constructive way to view 2025 is as a year where many regulators made the landscape more buildable — without pretending it is finished. For clients and market participants, that shift matters: Clarity lowers operational risk, supports investment in durable infrastructure, and enables more credible hybrid models that bring traditional finance safeguards to tokenized workflows.

The 2026 question is whether jurisdictions can keep translating frameworks into consistently supervised regimes — and whether global standards can converge enough to reduce fragmentation without suppressing innovation.