According to a study conducted by analytics company TRM Labs, about 80% of the 21 jurisdictions with a decisive impact on the crypto industry tightened their cryptocurrency regulations in 2023.

The main goal of introducing measures to more strictly supervise the crypto space, according to officials, is to strengthen consumer protection. Cryptocurrency exchanges operating in countries with a regime for obtaining licenses for working with digital assets, say TRM Labs analysts, show lower rates of illegal activity than sites in other countries.

The researchers listed the jurisdictions in which cryptocurrency companies are required to obtain a license to operate:

  • American state of New York;

  • Germany;

  • SOUTH AFRICA;

  • UAE;

  • Malaysia;

  • Thailand;

  • Hong Kong;

  • Singapore.

The report's authors suggest that regulators in these countries will continue to crack down on cryptocurrency mixers and other tools to increase the anonymity of transactions. In most countries, there is still a lack of clarity regarding the regulation of decentralized finance (DeFi), especially regarding issues related to the responsibility of service providers, their accountability, and the powers of regulatory authorities.

The lack of a comprehensive regulatory framework for cryptocurrencies in the United States also affects the industry. But despite this, TRM Labs analysts expect that in 2024 the federal courts will decide whether cryptoassets will be considered securities. This will be an important step for the further development of the industry, the researchers noted.

“2023 played an important role in the cryptocurrency space. It all started after the collapse of the FTX crypto exchange – a law on the regulation of cryptoassets (MiCA) appeared in the European Union. A licensing regime has come into force in Hong Kong. Singapore has finalized stablecoin regulation and streamlined consumer protection rules. South Korea has passed its first dedicated digital asset law. Australia has introduced a regulatory framework for stablecoins and other digital assets. The US Congress is also considering bills on stablecoins,” TRM Labs analysts list.

According to the company's earlier research, in 2022, 19% of illegal cryptocurrency transactions were in Bitcoin. In May, TRM Labs published a report indicating that in the first quarter of 2023, the volume of stolen cryptocurrencies fell by 65%.