The Financial Stability Board (FSB) released its first Thematic Peer Review on the implementation of its Global Regulatory Framework for Crypto-asset Activities (October 2025). This report evaluates how jurisdictions across the world are progressing in adopting the FSB’s 2023 recommendations for crypto-assets (CAs) and global stablecoins (GSCs) – a framework anchored on the principle of “same activity, same risk, same regulation.”
Global Snapshot: Uneven but Accelerating Progress
While crypto-asset markets have expanded rapidly – reaching nearly USD 4 trillion by August 2025 – the FSB found that regulatory progress remains uneven. Eleven jurisdictions, including the EU, Japan, Singapore, and Hong Kong, have finalised crypto-asset frameworks addressing financial stability risks. Eight others, such as Australia, Brazil, and the UK, are in advanced consultation stages, while six, including India, China, and Saudi Arabia, have yet to establish comprehensive regimes.
Stablecoin regulation lags even further. Only five jurisdictions (the EU, Japan, Hong Kong, Bermuda, and The Bahamas) have enacted full-fledged frameworks, leaving significant gaps in liquidity risk management, capital buffers, redemption guarantees, and cross-border oversight. Such asymmetry, the report warns, creates opportunities for regulatory arbitrage and complicates coordinated supervision across jurisdictions.
Crypto-asset Regulation: A Mixed Landscape
Jurisdictions have broadly chosen between two models:
- Extension of existing financial laws – seen in Singapore, Japan, and Hong Kong, which apply securities or payments regulations to crypto service providers (CASPs).
- Bespoke frameworks – led by the EU’s Markets in Crypto-Assets Regulation (MiCAR), Bermuda’s Digital Asset Business Act, and The Bahamas’ Digital Assets and Registered Exchanges Act, each tailored to crypto’s unique risks.
However, critical gaps persist in regulating high-risk activities such as crypto borrowing, lending, staking, and margin trading – areas often left outside existing frameworks. Few jurisdictions, such as Bermuda and The Bahamas, have comprehensive oversight for such activities, while others like Hong Kong, Korea, and Türkiye have chosen outright prohibitions to mitigate systemic risk.
Stablecoins: Fragmented Oversight, Systemic Risks
Stablecoins: whose market has grown by 75% year-on-year to nearly USD 290 billion – remain inconsistently regulated. The FSB notes that most jurisdictions’ mandates are ill-equipped to address GSC risks spanning multiple countries. Key shortcomings include:
- Weak liquidity management and reserve frameworks
- Limited recovery and resolution planning
- Divergent disclosure standards and custody rules
The FSB urges regulators to treat stablecoins as distinct payment instruments, not just crypto-assets, to ensure consistent redemption, collateralisation, and consumer protection regimes.
Data, Reporting, and Financial Stability Monitoring
Data gaps remain a major blind spot. Most jurisdictions lack comprehensive CASP reporting frameworks, constraining their ability to monitor systemic risks. The FSB calls for enhanced supervisory reporting from exchanges, stablecoin issuers, and custodians, and for improved data infrastructure linking crypto markets with traditional finance.
Cross-border Cooperation: Still Nascent
Crypto is inherently global, yet regulatory cooperation remains fragmented. Existing mechanisms – bilateral memoranda or AML enforcement channels – rarely extend to financial stability oversight. Divergent definitions of crypto-assets, secrecy laws, and differing institutional mandates further hinder information sharing. The FSB recommends jurisdictions:
- Assess the scale and direction of cross-border crypto flows,
- Build bilateral/multilateral supervisory arrangements, and
- Explore new tools for joint oversight of cross-border risks.
Key Recommendations for 2025–26
The FSB issues eight recommendations directed at both national regulators and international bodies:
- Accelerate implementation of the full FSB Crypto Framework.
- Promote alignment through coordination between the FSB, IMF, IOSCO, and Basel Committee.
- Close regulatory gaps in CASP and GSC frameworks using detailed gap analyses.
- Strengthen liquidity, capital, and risk management for stablecoins.
- Improve data infrastructure for real-time financial stability monitoring.
- Foster international consistency in regulatory approaches.
- Enhance cross-border cooperation, including supervisory colleges.
- Develop best practices for information-sharing and crisis coordination.
India’s Position
India, though part of the FSB’s review, remains in Stage 1- meaning no dedicated crypto framework yet. The report does acknowledge that “The government of India is examining policy approaches to implement the GSC recommendations.” This is inline with the pending release of the Discussion Paper. It is also heartening to see that Government of India is deeply engaging with Standard Setting bodies evident from this report’s acknowledgement of contributions from the Indian Ministry of Finance via Ms Manisha Sinha (former Additional Secretary, DEA). All of this underscores the country’s growing policy engagement, even as formal legislation is awaited.
Future Outlook
The FSB’s peer review highlights a clear message: while the world has moved from hesitation to structured action on crypto regulation, full alignment remains distant. As global crypto markets expand and interlink with traditional finance, consistent rules and data-driven oversight are essential to mitigate systemic risks.
For policymakers and industry players alike, the report sets the benchmark for what 2026 must deliver i.e., a globally coordinated, transparent, and resilient regulatory architecture for digital assets.