Each month, the Fireblocks policy team takes stock of policy developments around the world that matter to our clients and to our business. Here, I share my views on the April developments I think counted the most—at times intentionally highlighting announcements that didn’t make the headlines.
U.S. Crypto Policy Warms Up Under Trump Administration
As the Trump Administration marks its 100th day, digital asset developments in the US steadily support a drumbeat of removing barriers to the banking sector to engage with crypto.
This included the Federal Reserve Board (FRB) and Federal Deposit Insurance Corporation (FDIC) withdrawing joint statements issued in the wake of the 2023 FTX collapse related to the permissibility of engaging in crypto-related activities, while the Department of Justice (DOJ) released a memorandum serving as another measure to end “regulation by prosecution.” Meanwhile, President Trump repealed the so-called Internal Revenue Service’s (IRS) DeFi Broker Rule, which would have required decentralized finance applications to file as brokers for transactions.
Now all eyes are on progress of the US stablecoin legislation, and outputs from the SEC Crypto Task Force Request for Information and expert roundtables.
ECB Pushes Back on U.S. Crypto Momentum
As discourse on crypto is (thankfully) getting more pragmatic in Washington DC, the European Central Bank seems (unfortunately) to be moving in the opposite direction. This month, the ECB ramped up its campaign to express concerns that the US support for digital assets may destabilize the European economy. The ECB views found some sympathy in Germany and in Italy, but the European Commission has vehemently objected to them. Also a hearing on this in the European Parliament became a non-event. The outcome is (hopefully only) a temporary regulatory uncertainty for MiCA compliant US-issued stablecoins.
Of these, there is still only one in the EU. At the end of Q1, MiCA and DORA resulted in licensed 21 exchanges in the EU, 11 stablecoin issuers and (gasp) zero asset-reference token issuers.
The UK Charts a Clearer Path for Crypto and Tokenization
A better forecast for the UK. On April 29, the UK Chancellor shared an ambition for the UK to become a digital assets hub. This was supported by the publication of the outline for the UK crypto intermediary and stablecoin regulatory regime. Much detail is passed to the hands of the FCA. What stood out to me in the announcements was that Reeves did not shy away from naming crypto (rather than AI or digital more broadly) as the industry the UK wants to develop. She also chose to highlight the UK-US like-mindedness on crypto, extending all the way to not regulating the issuance of non-UK stablecoins. How different is her take from the ECBs?!
I do think advancing tokenized financial instruments has the most weight in the UK Government’s vision. On that note, it is very positive, and wise, that the UK will introduce dedicated custody rules for tokenized financial instruments.
Sandbox Season: Global Governments Revisit Innovation Zones
Cloudy with a Chance of Sandboxes. With the April announcements, the UK joined the EU, Dubai, Argentina and Philippines on the sandbox bandwagon. Governments’ interests in tokenized securities are giving the regulatory sandbox – a legal environment where certain rules are temporarily waived under certain conditions – a second life. There is no evidence to date that this is a winning approach, as the EU DLT Pilot Regime and the UK Securities Sandbox have produced no innovations. I do think it is extremely difficult to incentivise large regulated institutions to invest in experiments capped by volume, with an unclear path to production. For the time being, however, the political consensus is to keep trying to get it right, as evidenced by a Franco-Italian push this month.
In parallel, in the EU, the Commission kick-started the process of reviewing Europe’s capital markets rules. This, indeed, can be a promising path to production for DLT-based trading and settlement of tokenized equities and bonds.
MENA and APAC Updates: Security, Staking, and Sovereignty
Variable weather further East. Among MENA and APAC regulatory developments this month, two stood out to me.
Turkey is rapidly introducing a digital assets regime, which for custody requires 95% of assets to be held with external custodians, in Hardware Security Modules (HSM). The latter detail was expected, but became clearer as the country’s Scientific and Technological Research Institution published infrastructure criteria. An emphasis on data localization is also clearer.
In better news, Hong Kong has allowed its licensed exchanges to offer staking as a service. This is the first step from the ASPIRe Framework, which is set to boost the local ecosystem.
Mixed Conditions, Clearer Direction
April’s policy developments brought a mix of conditions: clearer skies in the U.S. and UK, cloudier outlooks in parts of Europe, and renewed interest in sandboxes across multiple regions. While not all efforts signal immediate progress, the direction of travel is clear. Stablecoins, tokenization, and institutional crypto adoption are moving steadily from concept to infrastructure. The challenge now is for regulatory frameworks to evolve with the same momentum—before the weather changes again.
