ChainCatcher report: WalletConnect has released a 68-page report titled “Policy, Compliance, and Regulatory Landscape,” which outlines global regulatory developments in areas such as payments, DeFi, trading, custody, and tokenization. The report notes that regulatory discussions in major markets have shifted from “whether to regulate” to “how to implement,” with frameworks progressing at varying speeds from legislation into practical enforcement—though cross-border rules remain highly fragmented. The report highlights that the European Union’s Markets in Crypto-Assets Regulation (MiCA) has been fully applicable since December 2024, with national transition periods ending on July 1, 2026; approximately 330 authorized crypto-asset service providers are currently listed on ESMA’s interim register, while over 1,000 firms operating prior to MiCA’s implementation reportedly failed to obtain authorization before the deadline. Hong Kong issued its first stablecoin issuer licenses in April 2026, and Japan’s amended Payment Services Act took effect in June of the same year. Although the U.S. GENIUS Act has been enacted, its related regulations will not be fully effective until January 18, 2027, and broader market structure legislation remains pending. WalletConnect states that jurisdictions are increasingly adopting a “regulated touchpoint accountability” model, whereby issuers and service providers remain responsible for AML, sanctions screening, travel rule compliance, and recordkeeping even when interacting with self-custodied addresses. Tools such as sanctions screening, on-chain analysis, verification of address control, and reusable identity credentials are already being deployed in certain operations, demonstrating that compliance and self-custody are not mutually exclusive; however, how to regulate decentralized software and protocols remains unresolved, with DeFi continuing to represent the primary frontier of global regulatory scrutiny.
WalletConnect Report: Global Crypto Regulation Enters Implementation Phase, DeFi Remains Key Challenge
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Summary
WalletConnect’s latest report outlines the global shift in crypto regulation toward implementation, with MiCA (EU Markets in Crypto-Assets Regulation) now fully active since December 2024. The EU’s framework extends until July 2026, with 330 authorized providers and over 1,000 rejected. Stablecoin regulation is also advancing, as Hong Kong plans to issue its first licenses in 2026. Japan’s revised Payment Services Act will take effect in June 2026, while the U.S. GENIUS Act awaits full implementation in 2027. DeFi remains a regulatory gray area, as protocols and decentralized software continue to challenge existing frameworks.
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