Nations Weigh Crypto Rules as Investors Demand Safety and Trust

The world is entering its ‘crypto era’. The headlines say it, the wallets prove it and the inflow in capital is speeding up (hello spot Bitcoin ETFs). Yet adoption hasn’t even hit full stride yet. Look at Australia for example: crypto adoption hovers around the 20% mark and dived 3% due to concerns around crypto regulation (41%). Ceilings like this aren't about lack of demand; but about hesitation. People aren’t always waiting for the next flashy token or speculative boom; they’re waiting for something far more boring - rules. They want to know that what they’re investing in or paying with is safe. They want regulation and here’s the kicker: regulation won’t slow crypto down - it will help unlock it.

\ Clarity is freeing

In crypto’s early days, adoption was driven by risk takers. The next wave of users wants certainty. Clear regulatory boundaries will help build trust in how the industry operates, and with this trust comes broader participation and capital. When we set the boundaries, we grow the trust. Tightening isn’t a brake; it’s the invitation.

As Scott Duke Kominers writes - “Some may push for a regulatory free-for-all, but that would be a mistake. History - and economic theory - shows that thriving markets require clear, consistent rules. Crypto is no exception.” He adds that crypto will only reach its potential if it’s widely used in everyday commerce and for that to happen, entrepreneurs and consumers need clear, protective rules (anti-fraud, fair access); without that regulatory confidence, most people won’t enter the market or use crypto day-to-day.

Let’s look at Australia again where legislators are moving to bring crypto exchanges under the same kind of standards that banks and stockbrokers already follow. Far from choking innovation, this is a move that is giving the industry legitimacy and that’s all the community has ever asked for: clear, concise rules instead of uncertainty and suspicion. When people know the rules, they feel safe to start committing. This is how you move from 20% adoption to 60% and it’s how you move from hobbyist traders to pension funds and corporates building real infrastructure on-chain.

\ So what do countries need to do to seize this moment? Here’s a wishlist for policymakers as we enter the next chapter.

1. Clarification around financial advice rules

   Right now, crypto lives in a regulatory blind spot in countries like New Zealand’s who have a ‘neutral’ financial advice framework. Advisers aren’t explicitly banned from talking about crypto, but they aren’t explicitly allowed to either. It’s regulatory purgatory and the result is that most professionals opt to steer clear. As a consequence, consumers are left to fend for themselves on Reddit, Discord or TikTok where some get good information; but many more get burned. This isn’t too hard to fix. A simple clarification that crypto advice can be given by licensed financial advisers under existing consumer protection standards would instantly unlock safer access. Americans and Europeans are seeing this shift now with clearer pathways for advice and consumer protection being built into their legislation. Why not everyone?

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2. Local currency stablecoin

   Every functioning economy runs on its own currency. You don’t fill up your petrol tank in Auckland and expect to pay in USD; yet that’s the risk if the New Zealand Government fails to issue a local stablecoin and the country slides into digital dollarisation where all payments default to US-backed tokens simply because no NZD alternative exists. Stablecoins are already the workhorses of crypto and they account for trillions in transaction volume every year, providing the stability that Bitcoin and Ethereum don’t. A Reserve Bank-backed stablecoin gives locals the confidence that they’re transacting in their own currency, governed by their own institutions. What’s more, this isn’t just about everyday payments. Mike Novogratz of Galaxy Digital recently predicted that AI agents could become the biggest users of stablecoins and that in the near future, your AI assistant could be paying your power bill, subscribing to a cloud service or settling invoices automatically. When that happens, you want those transactions tp be running in your local currency, not just USD because without a local stable, you risk exporting control of your own money to offshore markets. Guidance from every country’s Reserve Bank or monetary authority and policymakers on issuance, oversight and acceptance would be transformational.

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3. Custody and licensing guidelines for trading venues

   The third piece of the regulatory puzzle is infrastructure.Today, custody and trading venue rules are patchy at best and some exchanges act like fintech startups, others like quasi-banks. For everyday investors, that’s confusing and for institutions, it’s a dealbreaker. What we need is a fit-for-purpose licensing regime for crypto custody and trading venues that sets standards for security, capital requirements and accountability. Australia is moving in this direction already and Singapore, Japan and the EU have put frameworks in place. A licensing regime isn’t about tying the industry in red tape but about putting down the rails so larger players (such as New Zealand’s KiwiSaver or retirement fund providers) to listed companies can finally get on board.

Where to next?

The biggest risk to crypto adoption right now isn’t too much regulation; it’s actually too little. Applying familiar rules is how we de-risk the industry and turn hesitancy into confidence. If we get this right, countries won’t just play catch-up but can lead. Clarity is rocket fuel; and the world is ready for lift-off.

Disclaimer: Investing in crypto carries risk. Always do your own research or seek professional advice. Terms and Conditions apply

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