E-commerce and trade Archives | Page 2 of 204

EU and Mexico strengthen cooperation against crypto-related money laundering

Mexico and the European Union have agreed to expand cooperation on addressing money laundering involving cryptocurrencies and digital assets. The announcement was made during the 8th EU-Mexico summit, where both sides also advanced discussions on a modernised trade agreement.

Officials highlighted concerns regarding the use of digital assets in cross-border illicit financial activities linked to organised crime. The discussions focused on improving coordination related to identifying and disrupting suspected illicit financial flows.

The cooperation forms part of broader EU-Mexico engagement covering trade, investment, security, and digital policy. Both parties said they intend to continue dialogue and cooperation on evolving financial crime risks linked to the digital economy.

Why does it matter?

The agreement reflects a broader shift towards coordinated international enforcement against crypto-enabled financial crime, where illicit flows are increasingly moving across multiple jurisdictions with limited friction.

Strengthened cooperation between major regions like the EU and Mexico is intended to reduce enforcement gaps that criminal networks have been able to exploit.

It also signals how digital assets are becoming a central focus in global security and trade diplomacy, not just financial regulation. By linking anti-money laundering efforts with wider economic and strategic agreements, both sides are treating crypto-related crime as part of the broader challenge of safeguarding the integrity of the digital financial system.

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German lawmakers reject proposal to increase crypto taxation

A proposal by Germany’s Green Party to revise taxation rules for cryptocurrency investments has failed to advance in the Bundestag’s Finance Committee. The proposal aimed to remove the existing tax exemption on gains from digital assets held for more than one year.

Under current rules, profits from cryptocurrencies such as Bitcoin and Ethereum remain tax-free if assets are held beyond 12 months. Supporters of the proposal argued that current crypto tax treatment differs from broader capital gains taxation rules.

The initiative received limited parliamentary support, with concerns raised about potential legal inconsistencies and implementation challenges. Other parties, including those in the governing coalition, raised concerns that the reform could introduce new legal inconsistencies and fail to resolve perceived loopholes in the existing system.

At the same time, Germany continues to expand oversight of digital asset markets through new EU reporting requirements under the DAC8 directive. New reporting obligations under the EU’s DAC8 directive require service providers to supply detailed transaction data to tax authorities. The measures are intended to improve transparency and reporting related to cryptocurrency transactions.

Why does it matter?

The vote reflects a broader policy tension in Germany over how far governments should go in tightening taxation on digital assets without discouraging investment and innovation in the sector. It also signals that, for now, regulators are prioritising transparency measures like DAC8 reporting over immediate increases in tax burdens on crypto holders.

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European Central Bank examines systemic risks linked to AI-driven finance

The European Central Bank (ECB) has published research examining how AI systems could affect financial stability as AI adoption expands across financial markets.

According to Eurosystem research, different AI architectures may produce significantly different market behaviours under similar economic conditions.

ECB simulations compared reinforcement learning systems with large language model-based agents operating in simulated financial environments. Researchers found that some reinforcement learning systems displayed coordinated responses resembling bank run dynamics in certain scenarios.

The report linked part of this behaviour to risk-avoidance patterns associated with prior negative outcomes.

Large language model-based systems showed lower coordination but more variable and unpredictable responses during periods of uncertainty. Despite receiving identical instructions, LLM-based agents frequently developed different assumptions about market behaviour, particularly during periods of moderate economic uncertainty.

ECB researchers noted that such inconsistency could create its own form of instability as AI-generated expectations diverge across financial markets.

The ECB suggested that wider AI adoption in finance may require updated risk management practices, investor awareness, and regulatory safeguards.

The research also highlighted the potential importance of existing market stabilisation measures, including circuit breakers and investor protection mechanisms.

Why does it matter?

AI is rapidly becoming embedded in trading, investment management, and financial decision-making across global markets, meaning flaws in AI behaviour could amplify systemic risks at unprecedented speed and scale.

The research signals that financial stability may increasingly depend not only on economic fundamentals and regulation, but also on the underlying architecture, coordination patterns, and predictability of the AI systems shaping market activity.

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Singapore launches new AI, cybersecurity and quantum-readiness programmes

Singapore has announced new initiatives aimed at supporting enterprise AI adoption, strengthening cybersecurity, and preparing digital infrastructure for future quantum-related risks.

The measures were announced at ATxEnterprise 2026 by Senior Minister of State for Digital Development and Information Tan Kiat How. They include new partnerships under the Digital Enterprise Blueprint, an AI adoption playbook for enterprises, SME awards recognising AI impact, and a pilot on quantum-safe technologies.

According to IMDA’s Singapore Digital Economy Report 2025, AI adoption among SMEs increased significantly during 2024.

IMDA and the Singapore Business Federation will introduce SME AI Impact Awards recognising enterprises using AI technologies in business operations. Up to 30 winners will be recognised across categories for proprietary AI tools and adoption of ready-to-use AI solutions.

The Digital Enterprise Blueprint is being expanded through partnerships involving AI training, digital skills development, and cybersecurity support for SMEs. One programme led by Grab will provide AI-related training and courses for SMEs in sectors including retail, e-commerce, and food services.

RSM Stone Forest IT will also launch cybersecurity initiatives involving phishing simulations, awareness webinars, and tabletop exercises for SMEs. With the two partnerships, IMDA aims to reach 12,000 more SMEs, contributing to its target of supporting 50,000 SMEs by 2029.

IMDA, SkillsFuture Singapore, and Workforce Singapore have also developed an AI for Enterprise Impact Playbook to help digitally progressive enterprises assess readiness, identify support, and plan next steps for AI adoption.

Singapore additionally announced a pilot initiative focused on quantum-safe technologies for telecommunications infrastructure. IMDA signed a Memorandum of Intent with Singtel, Ericsson, and NCS Singapore to test and validate quantum-safe migration approaches.

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European banks create Qivalis to develop MiCAR-compliant euro stablecoin

A consortium of leading European banks has established Qivalis, an Amsterdam-based joint venture that plans to issue a regulated euro-denominated stablecoin under the EU’s MiCAR framework.

Qivalis is working towards authorisation and supervision by the Dutch Central Bank as an Electronic Money Institution. The project follows an earlier announcement in September 2025 that nine major banks had joined forces to develop a MiCAR-compliant issuer of a euro stablecoin. BNP Paribas later joined the consortium, expanding institutional participation.

The participating banks include Banca Sella, CaixaBank, Danske Bank, DekaBank, ING, KBC, Raiffeisen Bank International, SEB, UniCredit and BNP Paribas. The initiative is positioned as a banking-led effort to create a regulated euro stablecoin for digital payments and on-chain financial activity.

Governance arrangements have also been formalised. Jan-Oliver Sell has been appointed CEO, Floris Lugt will serve as CFO, and Sir Howard Davies has been named Chairman of the Supervisory Board. All appointments remain subject to regulatory approval.

Qivalis plans to launch the euro-denominated stablecoin in the second half of 2026, subject to regulatory approval. The stablecoin is designed to support 24/7 cross-border payments, programmable payments, supply-chain management and digital asset settlement, including tokenised assets and cryptocurrencies.

Project leaders framed the initiative as a way to strengthen Europe’s role in the digital economy while embedding regulatory compliance, financial stability and data protection standards into future digital money infrastructure.

Why does it matter?

Qivalis shows how stablecoin development is moving beyond crypto-native companies and into the regulated banking sector. A MiCAR-compliant euro stablecoin backed by major European banks could strengthen Europe’s position in digital payments, programmable finance and tokenised asset settlement, while offering a regulated alternative to dollar-dominated stablecoins. Its impact will depend on regulatory approval, market adoption and whether banks can make blockchain-based payment rails useful at scale.

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UK expands regulatory and infrastructure plans for digital finance

The Bank of England plans to publish draft rules for systemic stablecoins in June, as part of the UK’s broader digital asset regulatory framework.

Deputy Governor Sarah Breeden outlined the plans during the City Week conference in London.

According to officials, regulators are reviewing earlier proposals following industry feedback related to compliance and market impact. The proposals may include limits on overall stablecoin issuance and requirements for banks issuing stablecoins through separate legal entities.

Authorities are also considering branding requirements intended to distinguish stablecoins from insured bank deposits.

Breeden also referred to growing institutional interest in tokenised financial markets and distributed ledger-based settlement systems.

Several financial institutions, including HSBC, Euroclear, and London Stock Exchange Group, are expected to participate in the UK’s digital securities sandbox later this year.

Alongside private-sector initiatives, the Bank of England is also upgrading its Real-Time Gross Settlement infrastructure and exploring pilot projects involving tokenised government debt instruments. Authorities additionally aim to extend settlement operating hours toward near-continuous availability by the early 2030s.

Why does it matter?

The UK’s push to regulate stablecoins and support tokenized finance highlights how major economies are increasingly competing to become leading hubs for digital financial innovation.

Decisions taken by the Bank of England could influence how traditional banking, payments, and capital markets evolve globally as governments and institutions move toward blockchain-based financial infrastructure.

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European Commission opens consultation on crypto-assets regulation

The European Commission has launched a public consultation on the functioning of the EU’s Markets in Crypto-Assets Regulation, seeking feedback from stakeholders and the wider public as digital asset markets continue to evolve.

Implemented in 2024, MiCA established the EU’s harmonised regulatory framework for crypto-assets and related services. It covers crypto-assets, asset-referenced tokens, e-money tokens, stablecoins, their issuers and crypto-asset service providers operating across the bloc.

The Commission said crypto-asset markets and the wider policy landscape have continued to expand since MiCA was developed. It is assessing whether the current framework remains fit for purpose in light of market and international regulatory developments.

The consultation seeks feedback on MiCA’s main building blocks. It includes a public questionnaire for individuals and a targeted consultation covering more technical and legal questions for stakeholders such as digital asset issuers and service providers, financial institutions, technology providers, academia, think tanks, industry bodies, consumer organisations and the EU public authorities.

Feedback submissions are open until 31 August. The Commission said the responses will inform its future policy work on digital assets.

Why does it matter?

The consultation shows that crypto regulation is entering a more adaptive phase, in which policymakers are assessing whether existing rules can keep pace with evolving markets and international approaches. Any future adjustment to MiCA could affect stablecoin issuers, crypto service providers, investors and wider digital finance policy in the EU, while also influencing regulatory debates in other jurisdictions.

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PARITY Act pushes new US crypto tax relief framework

A bipartisan group of US lawmakers has introduced the Digital Asset Protection, Accountability, Regulation, Innovation, Taxation, and Yields Act, known as the PARITY Act, as Congress continues expanding its focus on cryptocurrency regulation and taxation.

Representatives Steven Horsford, Max Miller, Suzan DelBene and Mike Carey introduced the proposal on 19 May, calling for clearer and more practical tax standards for digital assets. Supporters say the bill is intended to provide clarity, consistency and guardrails for the taxation of digital asset activities.

The proposal would create a deemed-basis rule for regulated, dollar-pegged payment stablecoins, treating certain digital dollars used like cash as cash for tax purposes. Lawmakers say the measure is designed to reduce administrative burdens for the Internal Revenue Service, provide consumer relief in routine transactions and prevent misuse through trading or arbitrage activity.

The bill would also provide tax certainty for foreign investors trading on US digital asset platforms, extend securities-lending tax principles to qualifying digital asset loans and apply anti-abuse provisions such as wash-sale and constructive-sale rules to digital assets.

Additional provisions would align the tax treatment of professional digital asset dealers and active traders with existing securities markets by allowing a mark-to-market election. The bill would also address the ‘phantom income’ issue for miners and stakers by creating an election for when digital asset rewards are taxed, modernise charitable contribution rules for digital assets and clarify that passive protocol-level staking by investment funds is not a trade or business.

The measure arrives as Congress debates broader cryptocurrency legislation linked to market structure and stablecoin oversight, including the CLARITY Act. Together, the proposals show how US lawmakers are increasingly addressing digital assets through taxation, consumer protection, market integrity and financial regulation.

Why does it matter?

Crypto taxation remains one of the main barriers to wider digital asset use, especially for stablecoin payments, staking, lending and routine transactions. The PARITY Act would aim to make tax treatment more predictable while applying anti-abuse rules to digital assets that are more closely aligned with traditional financial markets. Its impact would depend on whether Congress can integrate tax reform with wider debates on stablecoins, market structure and investor protection.

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Japan backs blockchain and AI-based financial infrastructure proposal

Japan has approved a policy proposal focused on blockchain technology and AI within future financial infrastructure development. The proposal reflects broader efforts to integrate digital technologies into financial systems and economic operations.

According to the proposal, backed by the ruling Liberal Democratic Party and endorsed by the government’s Policy Council, the initiative envisions expanded use of automated and continuously operating digital financial systems.

The proposal, titled the ‘Next-generation AI & Onchain Finance Concept’, envisions a system that enables 24/7 digital commerce through blockchain networks, including those supporting cryptocurrencies such as Bitcoin. The proposal describes blockchain technology as a potential foundation for future financial infrastructure because of its verification and record-keeping features.

The strategy includes consideration of tokenised financial instruments, including tokenised stocks and yen-denominated stablecoins. The proposal also discusses possible tokenisation models linked to the Bank of Japan’s current account deposits.

The Financial Services Agency has been tasked with developing a five-year roadmap to encourage both public and private sector investment in the initiative. Policymakers said the initiative is intended to support financial innovation and the development of programmable financial services.

Why does it matter?

Japan’s move is a major shift in how a leading economy is attempting to merge traditional monetary systems with blockchain and AI, potentially setting a benchmark for other countries exploring programmable finance and tokenised assets.

It could accelerate competition among jurisdictions to define standards for digital financial infrastructure, influencing how central banks, regulators and markets approach the integration of crypto, tokenisation and automated financial systems.

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US lawmakers push permanent CBDC ban over surveillance concerns

Republican lawmakers are seeking to permanently block the creation of a US central bank digital currency as the House prepares to consider an amended housing bill later this week.

Representatives Mike Flood and Warren Davidson are pushing to remove language that would allow a restriction on a US CBDC to expire in 2030. Their proposal is intended to prevent what they describe as a future pathway for developing or issuing a digital dollar.

The debate follows earlier House action on the Anti-CBDC Surveillance State Act, sponsored by Representative Tom Emmer. According to Congress.gov, the bill would prohibit a Federal Reserve bank from offering products or services directly to individuals, maintaining accounts for individuals or issuing a central bank digital currency. It would also restrict the Federal Reserve Board from using a CBDC to implement monetary policy or from testing, studying, creating or implementing one, subject to exceptions in the bill.

Debate over central bank digital currencies in the United States has increasingly focused on privacy, financial surveillance and government control over payment systems. Critics warn that a digital dollar could expand state oversight of financial activity, while supporters of CBDC research argue that central bank digital money could modernise payments and support financial inclusion.

Lawmakers backing permanent restrictions have repeatedly cited civil liberties concerns and pointed to China’s digital currency model as a warning against state-controlled digital money. The dispute also reflects a broader divide over whether the future of digital payments should be led by public central bank infrastructure or by private-sector instruments such as stablecoins and other digital assets.

Why does it matter?

The debate could shape the direction of US digital finance policy by limiting the Federal Reserve’s ability to develop or even test a digital dollar. A permanent CBDC restriction would reinforce a policy preference for private-sector payment innovation, including stablecoins and cryptocurrencies, while narrowing the role of public central bank money in future digital payment systems. It also places the United States on a different path from countries that are actively exploring or deploying CBDCs as part of payment modernisation and financial sovereignty strategies.

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