Cryptocurrencies are on their way to becoming the foundational layer of global finance. But while crypto itself was built to move without borders, the laws that govern it are still stuck inside them, and unfortunately, they are quite out of sync.
4 Tips to Navigate Fragmented Crypto Regulations
- Set up a base of operations in a predictable jurisdiction.
- Keep your compliance modular.
- Aim for jurisdictions that will make for an easier legal fit.
- Plan your exits before you need them.
That mismatch is a major headache for lawyers, regulators and compliance teams at companies alike. For any business trying to build a solid multinational infrastructure in this space, compliance today is a structural challenge. And the problem isn’t so much the rules themselves, but how much they diverge across jurisdictions and disagree with each other.
Same Industry, Different Rulebooks
Governments around the world are moving toward regulating crypto, that much is true. The trouble is, they’re often working in different directions.
For example, the United Kingdom previously introduced a draft legislation in April 2025, which could bring crypto firms under the same core financial rules as banks and brokers. In practical terms, that means applying the same capital requirements, disclosure standards and consumer protection measures that have long been standard in TradFi.
Meanwhile, across the ocean, we have the United States, where crypto oversight so far has been driven primarily by enforcement measures from local watchdogs rather than any clearly defined rules. But there are signs of change on that front. The current White House administration is interested in turning the country into a global crypto leader, so we may see a more in-depth approach to regulation.
For example, in July 2025, the House of Representatives passed the Digital Asset Market Clarity Act, also called the CLARITY Act. Its goal is to draw legal boundaries between the SEC and the CFTC, firmly defining who regulates what. While still unclear if the Act will fully come into effect, it’s definitely a step up from the patchwork of court cases the US saw before.
And if we turn toward Asia, we can see an even bigger mix of approaches. In Japan, the shadow of the Mt. Gox collapse still lingers, driving a harsher regulatory stance. That failure of 2014 shook public trust in a big way and prompted the local lawmakers to tighten the screws.
Today, stablecoin issuance, for example, is limited only to banks and trust companies. Custody assets must be strictly segregated from company funds, and exchanges are required to maintain transparent ownership structures. In short, what we have here is one of the most conservative regulatory regimes in the world.
But look at Hong Kong, and we can see the opposite picture, with an open-door approach to retail crypto trading. Admittedly, the licensing regime is still pretty rigorous here, but the overall stance is much friendlier. Since 2023, the region has still attracted more than 30 applicants since 2023, signaling strong market interest, even with the high-standard policy in place.
Without going much further, we can clearly see that every region and every country has their own view on how digital assets are to be regulated. And it’s hard to expect that they will all suddenly find a middle ground. Not anytime soon, at least.
Understanding the Impact of Conflicting Crypto Regulations
The unfortunate reality for global crypto companies is that licenses don’t travel across jurisdictions. A platform fully compliant under MiCA in France may find that license useless when onboarding users in Singapore. A “utility token” under EU law might be treated as a security by the UK’s FCA. Or, in other countries, it might even be banned outright.
In order to operate in such conditions, companies are forced to rebuild the same product multiple times to meet different local definitions. That means redesigning onboarding flows, restructuring custody systems and changing token availability. Even if the product itself is working fine, it doesn’t have much hope of going far when the laws don’t align.
And playing such legal survival games is very taxing for companies. Larger compliance teams, slower market launches, less cohesion between business vision and actual ability to achieve results. It’s a resource-draining cycle that doesn’t end.
Over time, even large companies start reorganizing themselves around legal realities instead of market opportunities. Development may be based in Singapore, custody in Switzerland, and licensing in the EU. That’s not scaling where you’re strongest — it’s scaling where the ground is firm enough to stand on.
Why Flexibility Is Key to Crypto Growth
Based on everything we’ve covered so far, waiting for the world to agree on crypto rules is not a viable strategy. If anything, it’s like waiting for all traffic lights to turn green at the same time. The likelihood is just about zero.
A more sensible thing to do in such circumstances is to design your systems with contradicting laws in mind from the beginning. Build your infrastructure in such a way that it can handle different (and constantly changing) legal frameworks without breaking your product. How, you might ask?
Well, first of all, it would be a good idea to drop anchor in a predictable jurisdiction. Set up your base of operations where rules are clear enough to plan around and where regulators are open to dialogue. That could be MiCA in the EU, the Monetary Authority of Singapore, or Abu Dhabi’s sandbox — whichever you think works for you. The key is knowing you can move forward without second-guessing every step and product release.
Next, make sure to keep your compliance modular. Don’t bother hardwiring your KYC stack, custody model or token classification to a single jurisdiction. Build them as swappable services that can be upgraded or geofenced. A modular back end makes it far easier to adapt without halting progress for significant periods of time.
Then, reconsider your approach to global expansion and aim for jurisdictions that will make for an easier legal fit. If your model already aligns relatively well with local rules, entering such a market will be much easier. A timely launch in the right environment beats 10 launches stuck in limbo.
And finally, plan your exits before you need them. There is always a possibility that you’ll need to quickly pull out of a market. For such events, you need to have a clean off-switch for jurisdiction-specific features and services. Taking care of this in advance will save you a lot of headaches later.
The push for clearer crypto regulation isn’t slowing down, but the number of layers just keeps piling up. For companies, this means the compliance challenge is only going to get worse.
If you want to survive, it won’t be the flashiest product that secures your success. It will be a flexible infrastructure that can keep your business intact while the laws change around you.
