Regulatory Roundup #11

Summary 

The US regulatory scene delivered the classic crypto drama we expect: the CLARITY Act, Washington’s big push for rules, got benched in the Senate thanks to political bickering and Coinbase dramatically pulling its support, leaving the market structure framework exactly where it likes it - in purgatory. 

Meanwhile, others are building new rails while the Senate dithers – the CFTC launched a push to modernize oversight, and the NYSE decided 24/7 trading on a tokenized securities platform means sleep is officially obsolete. On the global front, Bermuda is aiming to become the world's first fully on-chain national economy (with Coinbase and Circle doing the plumbing), the EU's Digital Euro package inches toward approval, and South Korea is busy advancing tokenized securities while adding a full suite of institutional guardrails.

🔦 Spotlight

🎯 Spotlight: CLARITY hits a wall in the Senate (and Coinbase brings the bricks)

For a brief, shining moment, it looked like Washington might actually do the thing the digital asset market has been asking for since… roughly the invention of crypto – write down the rules. The Digital Asset Market Clarity (CLARITY) Act is meant to draw cleaner lines between what is policed as a security and what is treated as a commodity, while also setting baseline expectations around market integrity and consumer protection. It already cleared the House with a bipartisan majority back in July 2025, so the Senate phase was supposed to be the “hard part, but at least it’s happening” chapter.

Instead, the Senate Banking Committee’s planned momentum essentially evaporated. In an unexpected move on 14 January 2026, the Committee postponed a critical markup session that had been scheduled for the following day, immediately injecting the sort of uncertainty markets normally reserve for Elon tweets and the latest noise around Greenland. The delay matters because this is the gateway step before anything gets near a full Senate vote, and the legislative calendar only gets less forgiving from here.

So what actually tripped the wire? Because we can’t have nice things, it was not one tidy policy disagreement but a mounting pile. The markup arrived with a huge stack of proposed amendments, and the politics around them turned into a high-stakes game of Jenga. The chair reportedly chose postponement over pushing ahead and risking a visible failure, which would have been a gift-wrapped headline for anyone who thinks crypto regulation should remain permanently just about the vibes.

The biggest flashpoint was stablecoins, specifically whether platforms should be allowed to pay rewards on stablecoin balances. An amendment backed by the banking industry would tighten the screws by preventing exchanges and other platforms from paying “interest-like” rewards to customers holding stablecoins, even where the platform is not the issuer. Banks see this as protecting deposits; crypto firms see it as lawmakers protecting the banks.

And then came the real drama – Coinbase publicly pulled its support for the bill “in its current form”, right as the Senate was gearing up to move. The firm argued that it is preferable to have no bill than a bill that bakes in constraints that are worse than today’s messy status quo. The timing was especially explosive given Coinbase’s role as one of the most prominent advocates for getting a market structure framework over the line.

This was not seen as a calm, technocratic disagreement. Other industry voices reportedly urged sticking with negotiations rather than walking away, and the episode exposed a familiar truth about the crypto industry lobbying as a single unit – it doesn’t. The second you get into specifics, like stablecoin rewards, tokenized equities, and DeFi perimeter questions, you discover that everyone loves clarity, right up until they have to agree on what it means.

Under the surface, there are two additional tensions that keep popping up. First, how far the bill reaches into DeFi and software developer activity, and whether the drafting genuinely protects builders from being treated like intermediaries. Second, the political cross-currents around ethics and conflicts of interest, including whether the bill should tackle senior officials’ crypto entanglements inside the package or leave it to separate processes. Those aren’t ancillary matters – they have the effect of leaving bipartisan consensus frozen in the Senate permafrost.

Where does that leave us? The optimistic take is that this is a pause to broker a landing zone, not a burial, and there are still plausible routes to revive progress in late January and beyond. The less comforting read is that every week of delay increases the odds the bill gets dragged into the gravitational field of the November 2026 midterms, where nuance will be obliterated. In the meantime, the US remains stuck in the awkward interim: policy intent and regulatory strategy is moving towards frameworks, but the day-to-day reality is still shaped by patchwork guidance, enforcement risk and whatever the next pile of amendments looks like.

🌎 Global Developments 

🇺🇸 United States 

CFTC launches “Future-Proof” push to modernize crypto oversight

New CFTC Chair Michael Selig has unveiled a “future-proof” initiative aimed at updating the agency’s approach to emerging markets, with digital assets and prediction markets explicitly in scope. The core idea is a top-to-bottom review of legacy CFTC rules, many of which were written for traditional futures markets, and then modernizing them so they actually fit new products and trading models. This all while continuing to focus on fraud and manipulation.

Selig sees a chance to keep new financial infrastructure onshore via clearer, more tailored rulemaking, rather than letting uncertainty do the industry’s offshoring for it. The initiative also tees up the CFTC to look more “future-ready” just as Congress continues debating whether to expand the agency’s role in crypto market structure.

NYSE builds a tokenized securities platform for 24/7 trading, because who needs sleep anyway?

The New York Stock Exchange (owned by ICE) says it’s developing a tokenized securities platform designed to support around-the-clock trading and on-chain settlement. The concept is a separate venue from the traditional NYSE, with features aimed at making tokenized shares/ETFs feel “native” to digital rails - instant settlement, dollar-based order sizing, and funding that could include stablecoins (subject to regulatory approval).

If it gets the green light, it’s another big “TradFi is coming on-chain” signal and a direct nod to the global demand for US equities outside New York hours. It also raises the less glamorous questions that will define whether this is revolutionary or just an expensive demo: market integrity across a 24/7 cycle, how surveillance and halts work when time is a flat circle, and how tokenized settlement plugs into existing custody and clearing expectations. 

🇧🇲 Bermuda

Bermuda wants a nationwide “on-chain economy” (with Coinbase + Circle as the plumbing)

The government of Bermuda has announced plans to transform the island’s financial system into what it’s calling the world’s first fully on-chain national economy, teaming up with Coinbase and Circle to provide digital-asset infrastructure for government, banks/insurers, businesses, and consumers.

The initiative was unveiled at the World Economic Forum in Davos and starts with pragmatic pilots rather than turning everything into a token overnight. The first wave includes stablecoin payment pilots for government agencies, tokenization tooling for financial institutions, and nationwide digital finance education/onboarding so ordinary residents and SMEs can actually use the rails being built.

A key focus is USDC as a dollar-denominated medium for low-cost merchant payments, explicitly framed as a way to reduce the fees and friction that smaller island jurisdictions often face with traditional payment processors and correspondent banking setups. Bermuda also points to existing local examples of stablecoin usage and prior “real-world” activations to argue this is an expansion of something already working, not a science project.

It’s also not Bermuda’s first rodeo. The government highlights its early mover advantage on regulation via the Digital Asset Business Act (2018) and notes that Circle and Coinbase were early licensees under that regime. 

🇪🇺 European Union

Digital euro latest: Council green-lights negotiations, Parliament vote looms

The EU Council agreed its negotiating position on 19 December 2025, which means the digital euro package can now head into trilogue talks with the European Parliament. The Council’s line is that a digital euro would complement cash, work online and offline, and sit alongside private payment options while keeping central bank money as the anchor of the euro-area payments system. The mandate also focuses on two key areas – privacy (a “high degree” of it), and financial stability, via holding limits so the digital euro doesn’t turn into a mass-market store-of-value product.

The politics, though, are getting lively. The Parliament is expected to hold a crucial vote in the first half of 2026, and the numbers are tight enough that it could get genuinely nervy. The ECB is responding with a full-scale persuasion tour, framing the project as a sovereignty play in a payments landscape dominated by US firms and USD-denominated tokens (with the geopolitical leverage that comes with that). The timeline is still ponderous – a pilot in 2027, with a first launch targeted for 2029, assuming the legislation makes it over the line first. There remains a lot of noise – banks are warning about cost and complexity, while sceptics on the right are pushing concerns about demand, privacy, and the future role of cash, which the Council is simultaneously trying to bolster with its parallel cash regulation.

🇪🇺 MiCA Authorizations Update (per ESMA CASP Register)

• 🇸🇰 Firefish (02/01/2026)
• 🇩🇪 DZ BANK AG Deutsche Zentral-Genossenschaftsbank (23/12/2025)
• 🇱🇮 Bank Frick AG (23/12/2025)
• 🇧🇬 Alaric Securities (22/12/2025)
• 🇦🇹 Coinfinity (19/12/2025)
• 🇩🇪 wSw PortfolioManagement AG (19/12/2025)
• 🇩🇪 FIDUS Finanz AG (19/12/2025)
• 🇮🇪 StoneX Digital (19/12/2025)
• 🇱🇮 LGT Bank AG (19/12/2025)
• 🇸🇰 BITCOINMAT (19/12/2025)
• 🇩🇪 Sutor Bank GmbH (18/12/2025)
• 🇮🇪 Webot (18/12/2025)
• 🇸🇰 Cryptovoucher (18/12/2025)
• 🇸🇰 FUMBI (18/12/2025)
• 🇸🇰 Madison Six (18/12/2025)
• 🇩🇪 Volksbank Raiffeisenbank Würzburg eG (17/12/2025)
• 🇦🇹 DADAT (16/12/2025)
• 🇩🇪 VR-Bank Rottal-Inn eG (16/12/2025)
• 🇮🇪 Confirmo Limited (16/12/2025)
• 🇱🇹 Coingate (16/12/2025)
• 🇱🇹 Simplex (16/12/2025)
• 🇩🇪 Hannoversche Volksbank eG (12/12/2025)
• 🇩🇪 VR TeilhaberBank Metropolregion Nürnberg eG (12/12/2025)
• 🇩🇪 VR Bank Südpfalz eG (12/12/2025)
• 🇱🇺 Zodia (12/12/2025)
• 🇩🇪 Westerwald Bank eG Volks- und Raiffeisenbank (11/12/2025)
• 🇩🇪 Fels wealth GmbH (10/12/2025)
• 🇱🇻 Nexdesk (10/12/2025)
• 🇮🇪 CoinJar (09/12/2025)

🇰🇷 South Korea

A lot going on in South Korea – here’s a whistlestop tour.

Tokenized securities get a legal runway (National Assembly passes STO amendments)

South Korea’s National Assembly has passed amendments to the Electronic Securities Act and the Capital Markets Act to formally enable token securities (security tokens) issued and recorded using distributed ledger technology. In plain English: tokenized issuance moves from “interesting pilot” to “recognized form factor”, with the distributed ledger explicitly treated as a legally effective securities ledger, while the usual securities-law obligations (authorization, prospectus/disclosure, etc.) still apply.

The changes also open the door for investment contract securities (a catch-all for more bespoke, project-linked instruments) to be distributed through licensed securities firms, rather than requiring issuers to market directly to investors. The legislation is set to take effect one year after promulgation (expected around January 2027), and the FSC plans to stand up a multi-stakeholder token securities consultative group from February 2026 to hammer out the practical plumbing (infrastructure, issuance rules, and secondary trading/disclosure).

Corporate crypto investing is back on the menu (with guardrails)

South Korea’s Financial Services Commission is moving to end the long-running restriction on corporate crypto investing, opening the door for listed companies and professional investors to participate under formal guidelines. After years of a retail-dominated market, it’s a meaningful shift towards institutional participation, even if the regulator is very much keeping its hand on the volume knob.

Reporting suggests the framework will come with tight controls, including eligibility conditions and constraints designed to keep corporate balance sheets from turning into accidental altcoin portfolios. It’s “welcome back”, but with a lanyard and a compliance induction.

However, listed firms face a proposed 5% cap on crypto exposure

In tandem, South Korea has proposed a 5% limit on listed firms’ crypto exposure, effectively capping how far public companies can go in building digital-asset positions. The proposal also reportedly restricts investment to the top 20 cryptocurrencies by market capitalization, signaling a clear preference for liquidity and relative market maturity.

The policy intent is pretty transparent - allow corporates to engage, but avoid a scenario where price volatility becomes a material threat to listed-company stability. For markets, it reads as cautious normalization rather than a green light for treasury-style crypto accumulation.

Google Play blocks apps from unregistered overseas exchanges

South Korea is also tightening access by leaning on platform gatekeepers. From 28 January 2026, Google Play is expected to block downloads and updates of apps from unregistered overseas crypto exchanges and wallets, effectively turning app distribution into a compliance choke point. In a market with heavy Android usage, this is a practical enforcement lever, not a theoretical one.

This sits alongside broader efforts to bring more of the digital-asset ecosystem into regulated lanes, including parallel moves on tokenization frameworks. 

Ownership cap proposal puts South Korea’s exchanges on edge

Finally, South Korea’s exchange industry is pushing back against a proposal to cap major shareholder ownership in crypto exchanges at around 15–20%. Local exchange representatives argue the measure could disrupt governance, deter investment, and create operational uncertainty, particularly for businesses that still need capital to keep up with compliance and security expectations.

From the regulator’s perspective, the thinking seems to be about avoiding concentrated control over market infrastructure. From the exchanges’ perspective, it’s a forced reshuffle with unclear upside. Either way, it’s another sign that the next phase of crypto regulation is increasingly about market structure plumbing, not just AML requirements.

🔎 Things to Watch

• 🏛 US Senate progress/bickering on market structure regulation.
• 🇦🇺 Second reading of Australia’s Corporations Amendment (Digital Assets Framework) Bill 2025, which will establish the framework for the country’s digital asset regulatory framework.

Coming into view:

• 🇬🇧 Further FCA consultations and final rules for the UK crypto regime.

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