Introduction

The Financial Stability Board (FSB), the international body that advises the G20 on global financial stability, has released a new report highlighting serious shortcomings in how countries regulate cryptocurrencies. Despite years of discussion, the FSB says the world is still far from having a unified and effective framework for digital assets.

Global Rules Still Fragmented

The report points out that while some regions—such as the European Union with MiCA—are moving ahead with comprehensive legislation, others remain unprepared. This imbalance has created what the FSB calls “regulatory gaps,” allowing crypto companies to shift operations to countries with weaker oversight. The lack of consistency also makes it harder for authorities to track cross-border transactions and enforce anti-money laundering standards. Stablecoins, tokenized assets, and DeFi platforms are singled out as areas of particular concern.

Key Risks Highlighted

According to the FSB, the most urgent issues include:

• Unregulated stablecoins: Many stablecoins still operate without clear reserve rules or disclosure standards.
• DeFi complexity: Decentralized finance continues to grow faster than regulators can keep up with.
• Market transparency: A lack of reporting and auditing standards increases the risk of manipulation and fraud.
• Without proper coordination, the FSB warns that these vulnerabilities could spill over into traditional finance during times of stress.

Push for International Cooperation

To address the gaps, the FSB is calling for stronger coordination between national regulators. It wants countries to share data, enforce similar disclosure rules, and monitor stablecoin operations more closely. The report emphasizes that collaboration with the International Monetary Fund (IMF) will be crucial to develop consistent international standards. These upcoming frameworks are expected to become reference points for G20 members in the coming year.

Slow Path Toward Unified Oversight

Even with new global standards on the horizon, experts believe progress will remain slow. Some governments see crypto as a source of innovation and investment, while others view it primarily as a risk. Political and economic differences continue to block full alignment on taxation, licensing, and enforcement. Until those issues are resolved, crypto markets will likely remain exposed to the same weaknesses that regulators have been warning about for years.

Conclusion

The FSB’s warning is another reminder that the crypto industry still operates in a regulatory gray zone. While global efforts are advancing, gaps between jurisdictions leave both investors and institutions vulnerable. Achieving global harmony in crypto oversight will be key to building a safer and more transparent digital economy.