WalletConnect has released a 68-page report, Policy, Compliance and Regulatory Landscape, reviewing regulatory developments across payments, DeFi, trading, custody and tokenization, according to ChainCatcher.
Focus shifts from whether to regulate to how to enforce
The report says discussion in major markets has moved from whether crypto should be regulated to how regulation should be implemented. It says regulatory frameworks are moving from legislation into practical enforcement at different speeds, while cross-border rules remain highly fragmented.
Regulatory updates across the EU, Hong Kong, Japan and the U.S.
According to the report, the European Union’s Markets in Crypto-Assets Regulation, or MiCA, has been fully applicable since December 2024, and its national transition period ended on July 1, 2026. The report says the European Securities and Markets Authority’s temporary register currently includes about 330 authorized crypto-asset service providers, while more than 1,000 firms that operated before MiCA’s implementation were reportedly unable to secure authorization before the deadline.
In Hong Kong, the first stablecoin issuer licenses were issued in April 2026. In Japan, the revised Payment Services Act took effect in June that year. In the United States, the GENIUS Act has become law, but the related regime will not be fully effective until Jan. 18, 2027, and broader market structure legislation is still pending.
Compliance duties still apply at regulated touchpoints
WalletConnect says jurisdictions are increasingly adopting a model in which responsibility sits with regulated touchpoints. Under that approach, issuers and service providers still need to meet anti-money laundering, sanctions screening, travel rule and recordkeeping obligations when interacting with self-custodied addresses.
The report says tools including sanctions screening, on-chain analytics, address control verification and reusable identity credentials are already being used in some businesses, showing that compliance and self-custody are not mutually exclusive. At the same time, it says how decentralized software and protocols should be regulated remains unresolved, leaving DeFi as a main frontier issue in global regulation.