For much of its history, crypto regulation has swung between the aggressive whiplash or vague promises. However, 2025 saw much and more happen definitively.
Regulation went beyond being a theory and became operational. The real impact, however, is set to come in the new year.
Here’s what you need to know.
2025: The year of developments
This past year was all about implementation, and two patterns stood out.
First, regulators set aside their obsession with banning activity and focused on regulating intermediaries like exchanges, custodians, and stablecoin issuers.
Second, compliance standards were established to strengthen financial crime controls.
The Travel Rule adoption came into place, AML expectations were set out, and registration regimes covered more types of virtual asset service providers (VASPs).
Source: TRM Labs
According to TRM Labs, jurisdictions representing over 70% of global crypto exposure enforced new regulatory measures in 2025.
This was with virtual asset licensing and supervision becoming the norm. Elliptic’s review also reported a similar change.
Regulators now treat crypto as mainstream financial infrastructure.
What did regulators focus on?
Stablecoins were the big winners as their use in payments and cross-border transfers grew.
Regulators set out clear rules on issuance, reserves, redemptions, and oversight. Stablecoins dominated policy discussions across the U.S., Europe, and Asia in 2025.
In the U.S., crypto regulation is finally becoming clearer. The GENIUS Act sets a timeline. Regulators must finalize the rules by July 2026, and the law will take effect soon after.
The U.S. Treasury is already working on these rules with industry input. Leadership changes, especially at the SEC, may act as a catalyst.
The U.S. is also pushing global standards through groups like the G20, FSB, and FATF to support dollar-backed stablecoins while reducing financial crime.
For the first time, U.S. crypto rules are coordinated.
Source: TRM Labs
Illicit finance was the second major focus. FATF guidance, sanctions enforcement, and blockchain surveillance were made to be better.
Regulators leaned heavily on analytics, information sharing, and partnerships with compliant VASPs to close gaps exploited by fraud networks and state-linked hackers.
Enforcement increasingly targeted weak links rather than the entire ecosystem. Regulated VASPs consistently exhibit lower rates of illicit activity than the entire ecosystem.
This makes compliant intermediaries essential.
The real winners
Large exchanges, custodians, and infrastructure firms that invested early in compliance had an advantage. Licensing rules raised entry barriers, while enforcement got rid of unregistered players.
Blockchain analytics firms also benefited. With stronger monitoring and risk checks, analytics became important.
Firms are now expected to track transactions across multiple steps and monitor risk on an ongoing basis.
What breaks in 2026
Smaller platforms operating without licenses will be under fire as enforcement actions increase. Protocols relying on the gray areas will encounter compliance friction or lose access to critical infrastructure.
Cross-border arbitrage will also become harder. International coordination has improved in 2025; actors can’t evade oversight. Implementation gaps narrow, and regulatory shelter zones shrink.
David Carlisle, VP of Policy and Regulatory Affairs, Elliptic Global, said,
“As we head into 2026, it will be critical for public and private sector stakeholders to maintain an effective, transparent dialogue so they can continue to address other emerging issues.”
What does the new year look like?
The impact of 2025’s regulations will not be sudden and dramatic. It’ll be a build up, the effects of which will become clear in the coming year.
As a result, there will be fewer platforms, but stronger ones. Fewer experimental launches, but more durable products. Less anonymity at scale, but greater trust from banks and regulators.
The next phase will be one of perfect execution. Regulation has narrowed the field, and those who remain will operate under closer scrutiny, and higher expectations.
Final Thoughts
- Over 70% of global exposure is now under active oversight.
- 2026 will reward compliant players and kill platforms that relied on regulatory grey areas.