top of page
Search

September's Global Regulatory Whirlwind: Key Developments in Digital Finance and Markets

September 2024 proved to be a whirlwind month for financial regulation across the globe. From the rise of digital currencies to the fight against economic crime, authorities worldwide flexed their regulatory muscles, signalling a significant shift in the financial landscape. Let's dive into the key developments:



Europe:


  • Digital Euro Takes Center Stage: The European Central Bank (ECB) made waves by championing a digital euro to reduce reliance on external payment systems. The research emphasised the need for a user-friendly design and public education to drive adoption.

  • MiCA Marches On Implementing the Markets in Crypto-Assets (MiCA) regulation continued with new rules on cooperation and information sharing between authorities and templates for agreements with non-EU countries.

  • Digital Markets Under Scrutiny: The European Banking Authority (EBA) released a report on the stablecoin framework design. At the same time, the European Union Agency for Cybersecurity (ENISA) published its 2024 threat landscape report, highlighting key cybersecurity concerns.


United Kingdom:


  • Digital Assets Gain Legal Clarity: A new bill aims to provide a clear legal framework for digital assets, classifying them as property.

  • Crypto Crackdown: The Financial Conduct Authority (FCA) took action against unregistered crypto ATM operators, signalling a more assertive approach to crypto regulation.

  • Fighting Financial Crime: The FCA emphasised a targeted, outcomes-focused strategy to combat economic crime, including innovative methods to tackle illegal financial promotions.


Australia:


  • Wholesale CBDC in Focus: The Reserve Bank of Australia and the Treasury prioritised research into wholesale Central Bank Digital Currencies (CBDCs), recognising their potential to revolutionise tokenised asset markets and cross-border payments.

  • AML/CTF Overhaul: A new Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) Amendment Bill seeks to expand the existing regime and modernise regulations for virtual assets.


Around the World:


  • Canada Explores CBDC Ecosystem Models: The Bank of Canada delved into potential frameworks and models for implementing a CBDC.

  • Hong Kong Bolsters Cybersecurity: A proposed cybersecurity law aims to strengthen critical infrastructure protection, while Project Ensemble Sandbox seeks to accelerate tokenisation adoption.

  • Brazil Advances CBDC Pilot: The second phase of Brazil's CBDC pilot program focused on testing financial services via smart contracts.

  • US DeFi Scrutiny Intensifies: The House Financial Services Committee held hearings on decentralised finance (DeFi), while enforcement actions targeted unregistered crypto offerings, illegal derivatives trading, and custody failures.

  • Qatar Unveils Digital Asset Framework: A comprehensive framework defines permitted tokens, licensing requirements, and guidelines for token service providers.

  • Saudi Arabia's Fintech Boom: A KPMG report highlighted the rapid growth and strategic opportunities within the Saudi Arabian fintech landscape.

  • UAE Embraces Digital Asset Custody: Standard Chartered launched a new digital asset custody service licensed by the Dubai Financial Services Authority.

  • India's Digital Transformation: The Governor of the Reserve Bank of India emphasised the transformative potential of Digital Public Infrastructure (DPI) and emerging technologies in finance.

  • Japan Pilots Stablecoin Payments: MUFG, SMBC, and Mizuho piloted a stablecoin-based cross-border payment platform.

  • Singapore Sees Stablecoin Surge: Stablecoin payments hit record highs, reflecting growing digital asset adoption in the region.


International Stage:


  • Swift's CBDC Plans: Swift announced plans to develop concrete solutions for CBDC and tokenised asset exchange, supporting various use cases across different financial sectors.

  • Tokenised Assets Soar: The market value of tokenised real-world assets (excluding stablecoins) surpassed $12 billion.

  • UN Champions Responsible Digital Payments: The UN released its Principles for Responsible Digital Payments, emphasising fairness, accessibility, and user protection.


The Takeaway:


In September 2024, there was unprecedented regulatory and technological activity in the financial world. This included the evolving landscape of digital currencies, tokenised assets, and ongoing efforts to combat economic crime. These developments indicate a significant change in the financial sector. Financial institutions must stay informed and adapt to these changes to remain competitive and compliant in this dynamic environment.



 
 

Sign up to be notified about the latest updates of what we think

The posts listed on the 'What we think' webpages are our interpretation of regulatory developments we have been reading about. They should not be considered legal, regulatory or other advice. Contact us if you want to understand the impact of public policy, regulation and governance changes for you.

bottom of page