How crypto laws are changing across the world in 2025

Everything looks set to change for crypto regulation and legislation in the United States in 2025.

Token Alliance co-chair Paul Atkins has been nominated to replace crypto antagonist Gary Gensler as chair of the Securities and Exchange Commission (SEC), signaling a major shift in how crypto is regulated in the United States. 

Gensler’s tenure, though instrumental in laying regulatory groundwork and case laws, drew heavy criticism for its reliance on enforcement-driven regulation.

Across the Atlantic, the European Union has implemented the first of its kind Markets in Crypto Assets (MiCA) regulation to oversee the crypto industry. While praised for its ambition, MiCA’s stringent rules are driving some businesses out of the region, adding to debates over the regulatory burden on digital markets. Meanwhile, Asia continues to integrate crypto into its legal systems, with significant cases setting local precedents.

To unpack the most important legal developments of 2024 and forecast what’s next, Magazine spoke with legal experts Catherine Smirnova and Yuriy Brisov of Digital & Analogue Partners in Europe, Joshua Chu of the Hong Kong Web3 Association, and Charlyn Ho of Rikka Group in the US.

The discussion has been edited for clarity and brevity.

Magazine: How will crypto law in the US change under the new administration?

Brisov: The Biden administration did a lot to prepare the legal frameworks for crypto assets. I’m sure that the proceeds of this preparation will help the next administration.

Willingly or not, the SEC helped shape the surface of crypto regulation so far. Common law countries are usually based on case law. We usually regulate when we have a sufficient amount of case law, and now is the time. 

Today, both Republicans and Democrats agree that crypto legislative reform is needed in the US. We still base crypto decisions on the orange groves in California in 1946, or the Howey case. 

Ho: The stepping down of Gensler and the nomination of Atkins to head the SEC is going to create a lot of change in the way that the crypto industry is regulated. When I say regulated, I don’t think that we will have an overarching regulatory regime in the next year. In fact, I would hazard a guess, Trump and Atkins are probably opposed to creating new regulations, but rather increasing the clarity as to where the crypto industry can operate. 

Gensler was criticized for taking an overly aggressive approach where he was stepping outside of the SEC’s congressional mandate and essentially making up powers and exercising what it did not have constitutionally. The change we’ll see is hopefully a decrease in such regulation by enforcement and perhaps more of a proactive, business-friendly, crypto-friendly approach taken by the agency as opposed to more of an antagonistic one. 

Magazine: What changes can we expect at the SEC with Atkins stepping in as chair, and how much influence will he have on ongoing legal matters?

Ho: From all accounts, Atkins’s background is very pro-business. He was an SEC commissioner previously so there is some history in how he would approach this role. 

That being said, there is a precedent set by Gensler for him to follow. Just because a new [chair] is named doesn’t mean that all the legal work product that has come out previously is just gone. Let’s hypothetically say there’s a lawsuit pending—and there are many. If Atkins wants to change the SEC’s position, he wouldn’t just be able to declare it. They would have to go through the legal process and have some justification in order to alter their claims. If they’re the plaintiff, they could just drop the lawsuit entirely. But the commissioner doesn’t have unfettered discretion to completely change everything that’s in process. 

Magazine: How are businesses in the EU responding to the implementation of MiCA and other digital regulations?

Smirnova: This year, what I call the Mario Draghi report said that our digital policy is not as good as we expected as a lot of potential unicorns are moving to the US. We believed that ex ante and clear regulation from early on will give transparency, but no—businesses treat it as a regulatory burden. 

MiCA, of course, which is the first [crypto] regulation in the world covering all the fields, trying to make this market more transparent and clear to all participants. Now we have regulation which is more strict and doesn’t require any additional actions from national jurisdictions. 

Next year, we’ll see if we still have a crypto market in the EU or if the regulatory burden will drive them out. We’re also expecting additional protection for digital consumers, through the Digital Fairness Act. What we’re witnessing now is that digital assets markets are regulated more by regulations that aren’t specially crafted for them. We have E-commerce Directive, DMA, DSA and GDPR. The proposal [for the Digital Fairness Act] was published already and released by the European Commission for comments, and we expect it will come into effect next year. It will be a high burden of pressure on digital business in the EU.

Chu: You need three things: legislation, enforcement action, and ultimately those two to be tested before the court of law; before you can really say that the regulatory regime in any particular jurisdiction is maturing. 

Using GDPR as context, when it came out, it rocked a lot of boats. The clarity on what to do only came about when the enforcement and fines started raining down.

Magazine: And are there crypto cases that have been tested in Hong Kong’s court of law?

Chu: In Hong Kong, we have seen this year legislative cases that are now being tested in court. So we have quite a few landmark decisions in Hong Kong, including the first case against JPEX. We will likely see more developments of that fraud case coming in the next year. 

We have also seen cases against decentralized autonomous organizations (DAOs). So we’re seeing how private parties, as well as regulators are catching up in terms of tackling these new entities. 

Magazine: How can Hong Kong fulfill its crypto hub ambitions with only a few licensed exchanges?

Chu: Do you really need that many exchanges floating around? If we look at it in the more traditional sense of a stock exchange, there’s one stock exchange. Why do we suddenly need three exchanges trading the same ten tokens aside from maybe arbitrage environments? 

Being a hub is great and having choices is great. But similar to virtual banks, there will be batches being rolled out. The last thing you want to do is create way too many competing exchanges and then it gets nowhere. It also spreads regulatory oversight quite thin as a result. 

Hong Kong has one of the more stringent regulatory regimes. You can’t even have options or derivatives. So people are wondering why are you buying it if it’s just on spot and you’re holding it. There are lots of issues that need to be ironed out.

Magazine: What are some legal developments that are generally being overlooked by crypto industry participants?

Smirnova: First, the Digital Markets Act and the Digital Services Act came into effect and a lot of tech companies just left the EU. 

Number two, the EU AI Act was adopted in and it affects all jurisdictions. It’s expected to have the same effect as the GDPR. If you provide AI related services in the EU, this act is applicable to your business. It doesn’t matter where you are incorporated. 

Now, digital companies need to worry about competition, transparency, privacy, AI and about consumer welfare.

Ho: I was keen on some of the AI agents and AI token developments. I think that is a huge development in 2024. We’re only going to see more of that in the future, especially with Coinbase’s AI agent transactions. To me, that’s just a little crazy. I find that pretty novel and legally very gray in terms of liability. 

I would say we probably won’t see much legislation, but there may be court cases that shed light on liability allocation. The reason I say that I don’t foresee a lot of legislation is because for many years, the crypto industry has been without an overarching legislative regime in the US. We don’t have a MiCA equivalent here. That’s kind of why the current SEC has been enforcing the way it has. They are essentially operating and interpreting laws that are many years old and that were never kind of contemplating crypto in mind. So to think that we would have AI-crypto legislation, I think is kind of a tall order. 

One of the other big things that happen is the overturning of the Chevron deference doctrine. The Supreme Court basically overturned this doctrine that’s been in place for quite some time that essentially granted or required deference to an agency’s interpretation of a rule.

That’s important because in this particular instance with crypto, that means that the courts don’t need to defer to the agency’s interpretation. Gensler’s interpretation or his commission’s interpretation was certainly very limited in crypto industries’ ability to operate. If the courts no longer have to defer to that interpretation, the logical thought would be that the crypto industry would have more freedom to operate.

Brisov: A big development for next year I expect is the understanding of crypto assets. In common law, we have two types of assets. We call them chosen in possession and chosen in action, which are basically tangible and intangible things. Possession is your iPhone, your apartment, or your car. Things in action are like securities, dept, or intellectual property. 

If we take NFTs, for instance, they used to be treated as just some form of tangible assets, though they are literally intangible. Therefore they couldn’t be security. But now, the SEC has started to investigate OpenSea. They claim that NFTs can also be securities. 

In the UK, there is a bill that offers the third dimension of assets which is not chosen possession, not chosen action, but a third category of assets: a digital thing, or digital asset. Through the case law in the US and in the UK, I think that legislation is also upcoming. This specific digital asset will form a new type of asset in the legal domain. That will be a huge trend that will be moving forward through upcoming years.

This article first appeared at Cointelegraph.com News