August is usually a quiet month for policy change on both sides of the Atlantic. Not so this year. With follow-ups from the busy first half of the year and preparations for an intensive last quarter, bureaucrats had little chance for summer plans.
U.S. Digital Asset Policy: From Wyoming to Washington
In the U.S., the Wyoming Blockchain Symposium took place just before Jerome Powell’s annual Jackson Hole address that hinted at an interest rate cut in September. Of note, Federal Reserve Board (FRB) Vice Chair for Supervision Miki Bowman and FRB Governor Christopher Waller advocated for crypto, payments innovation, and cutting red tape.
Meanwhile, the Wyoming Stable Token Commission launched the first U.S.-state-issued stablecoin, the Frontier Stable Token (FRNT), which Fireblocks supported.
Back in DC, we joined other industry leaders to respond to a request for information (RFI), following the release of a discussion draft market structure bill by the Senate Banking Committee.
And finally, two acts of regulatory clarity:
- Department of Justice (DOJ) Acting Assistant Attorney General Matthew Galeotti clarified that writing code does not constitute criminal activity, even if code is later misused.
- The Securities and Exchange Commission (SEC) released a statement that liquid staking does not constitute a securities transaction, signaling a significant step for tokenization policy.
Latin America: Tokenization Advances, CBDCs Expand
In the other hemisphere, no summer meant no break for regulators.
The Central Bank of Brazil blocked the approval of a Strategic Bitcoin Reserve during a congressional hearing.
Meanwhile, Argentina’s regulator, the Comisión Nacional de Valores (CNV), released a General Resolution that greenlights the use of tokenization for national and foreign stocks, financial trusts, and mutual funds.
The Central Bank of Bolivia announced the launch of its CBDC, the Boliviano Virtual, marking another step in Latin America’s shift toward sovereign digital currencies.
Europe: Digital Euro Speculation Heats Up
The standout development in the EU was a surprising report in the FT stating that the European Central Bank (ECB) aims to speed up development of the digital euro and maybe even issue it on a permissionless ledger.
This spurred a wave of interest in the EU-US stablecoin dynamics, giving us a chance to weigh in on CNBC and the FT’s Banking Risk and Regulation.
Two things to note:
- Timing remains political. We should remember that issuing the retail digital euro is not up to the ECB. Frankfurt still does not have a political mandate to do so – and policymakers in Brussels have been purposefully dragging their feet in negotiations. The cost of offering the digital euro and accepting it is still a problem for merchants and banks. Privacy concerns remain. Positioning the digital euro as a sovereignty priority in response to US developments, however, could shift momentum.
- Permissionless ledgers would be a major departure. To issue the digital euro on a tokenized form, let alone on Ethereum or Solana, is a drastic shift from all public reports and statements by the ECB. Perhaps the FT report is a first indication that this thesis is changing.
Fireblocks’ Chief Legal & Compliance Officer, Jason Allegrante, will be at Sibos in September for discussions on custody technology, tokenization, and regulatory convergence. If you’re attending, reach out to compare notes on how banks are operationalizing digital assets.
APAC: Hong Kong Pushes Custody and OTC Regulation
August was equally busy in APAC, where our focus was on Hong Kong’s Securities & Futures Commission (SFC).
The SFC closed regulatory proposals on OTC dealing and custody of digital assets. The interplay between the two is important – OTC dealers will be required to either become or rely on a regulated custodian. Interestingly, the SFC also explicitly permits connectivity to offshore liquidity and reputable third-country exchanges.
From a Fireblocks perspective, we note that the custody consultation explicitly contemplates the use of MPC technology – a change we believe will allow the re-regulation of the OTC market to be both more efficient (given current custodial arrangements), more scalable, and more secure.
Rather than drifting into the usual August lull, policymakers across the U.S., Latin America, Europe, and APAC kept digital assets firmly on the agenda. The pace and diversity of developments – from state-issued stablecoins in Wyoming to tokenization frameworks in Argentina and custody reforms in Hong Kong – show that digital asset regulation is no longer seasonal or reactive. It is becoming a permanent fixture of the global policy calendar, with September promising an even sharper acceleration.
