As the digital currency landscape matures, the year 2024 is poised to be pivotal in terms of regulatory developments.
Governments and financial institutions worldwide are expected to introduce a series of measures aimed at creating a more stable and secure cryptocurrency market.
**Global Regulatory Trends:**
The International Organization of Securities Commissions has laid out 18 recommendations for global rules on managing crypto and digital assets, signaling a move towards harmonization of regulations¹.
The World Economic Forum has been actively working on the Digital Assets Regulatory initiative, analyzing outcomes of different national approaches to digital asset regulation¹.
**US Regulatory Landscape:**
In the United States, the pace of regulatory actions shows no signs of slowing down.
The Financial Innovation and Technology (FIT) for the 21st Century Act and the Blockchain Regulatory Certainty Act are two bills that aim to define cryptocurrencies in terms of securities or commodities, expand oversight, and clarify the roles of different regulatory bodies¹.
**EU’s Pioneering Efforts:**
The European Union introduced the world’s first comprehensive cryptocurrency regulations in May 2023, known as the Markets in Crypto-Assets Regulation (MiCA).
This aims to establish uniform EU crypto regulation and provide legal certainty for digital assets beyond the scope of current EU financial services legislation¹.
**Focus Areas for 2024:**
Analysts predict that the focus areas for 2024 will extend beyond increased regulatory intensity.
Financial institutions are expected to develop stronger risk management frameworks and enhance their capital and liquidity requirements. Additionally, the importance of data governance and model risk management in global crypto regulation is anticipated to increase².
**Sustainability and ESG Factors:**
Sustainability and environmental, social, and governance (ESG) factors are expected to hold greater weight in international crypto regulation. Cybersecurity will continue to be a top priority as digital asset platforms remain targets for hackers and scammers².
**Conclusion:**
The year 2024 is shaping up to be a transformative period for cryptocurrency regulations. With governments and regulatory bodies worldwide striving to establish clear guidelines and frameworks, investors and businesses in the crypto space must stay informed and prepared for the changes ahead.
