Cryptocurrencies Archives | Digital Watch Observatory

Argentina proposes blockchain-based capital market reforms

Argentina has proposed sweeping capital market reforms that would integrate digital assets, blockchain technology and smart contracts into the country’s financial system, reflecting a broader effort to modernise financial regulation and expand the use of decentralised technologies.

The draft legislation would allow investment funds to hold digital assets where consistent with their investment policies and subject to regulatory approval. It also establishes a legal framework for the tokenisation of negotiable securities, enabling their issuance, custody, transfer and trading through blockchain-based systems.

The proposal would also recognise digital assets such as Bitcoin as eligible collateral for loans, potentially expanding access to credit for investors with significant cryptocurrency holdings. In addition, smart contracts would receive full legal recognition, allowing agreements such as leases and mortgages to be executed and enforced automatically through blockchain technology.

Although the bill remains in draft form and could change before being submitted to Congress, it reflects Argentina’s broader strategy of modernising financial regulation and encouraging innovation in digital financial markets.

Why does it matter?

The proposal illustrates how governments are increasingly seeking to integrate digital assets into established financial markets rather than regulating them as a separate sector. Legal recognition of tokenised securities, blockchain-based settlement and smart contracts could reduce uncertainty for institutional investors while supporting new financial products and services.

The draft legislation also reflects the growing convergence between traditional finance and decentralised technologies. If adopted, Argentina’s approach could contribute to wider international discussions on tokenisation, digital asset regulation and the role of blockchain infrastructure in capital markets.

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Coinbase prepares crypto infrastructure for quantum computing

Coinbase has outlined a long-term strategy to prepare both its own infrastructure and the wider cryptocurrency ecosystem for the eventual arrival of fault-tolerant quantum computing, warning that preparations for post-quantum cryptography should begin well before the technology becomes practical.

The company’s preparations focus on three areas. Coinbase is developing a post-quantum version of its proprietary key management system, reviewing internal systems that rely on encryption and monitoring developments across Ethereum and Base to ensure future upgrades remain compatible with emerging post-quantum cryptographic standards.

Beyond its own infrastructure, Coinbase will co-host a workshop with Stanford University in August, bringing together Bitcoin developers, cryptographers and researchers to discuss practical migration strategies. The company expects ongoing technical discussions to support collaboration on one of Bitcoin’s most significant long-term security challenges.

Coinbase has also joined the newly established Bitcoin Security Consortium as a founding member alongside major financial institutions and cryptocurrency companies. It plans to contribute engineering expertise and funding to support open-source proposals aimed at strengthening Bitcoin’s resilience against future quantum threats while encouraging industry-wide coordination on post-quantum readiness.

Why does it matter?

Although fault-tolerant quantum computers capable of breaking today’s cryptographic algorithms are not yet available, migrating large digital ecosystems to post-quantum cryptography could take many years. Early planning can reduce future operational risks and help avoid fragmented or incompatible security upgrades.

The announcement also highlights the importance of collective governance in decentralised ecosystems. Because blockchain networks depend on broad consensus among developers, operators and users, preparing for quantum computing will require coordinated standards, open-source collaboration and carefully managed transitions rather than isolated technical solutions.

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Vietnam sets penalties under new crypto market rules

Vietnam has introduced a new enforcement framework for cryptocurrency markets, establishing penalties for investors, service providers and token issuers as the country prepares to launch a regulated digital asset market through a pilot programme.

Under Decree No. 284/2026/NĐ-CP, which takes effect on 1 September, investors using unapproved crypto platforms could face fines, while companies offering unauthorised digital asset services may be subject to larger penalties. The framework also introduces sanctions for breaches involving customer verification, reporting obligations, token issuance and the handling of crypto account data.

The measures support Vietnam’s strategy of shifting crypto activity from offshore platforms to licensed domestic exchanges. Authorities are developing a limited number of approved trading platforms through a pilot programme intended to strengthen regulatory oversight, improve compliance and enhance investor protection in one of the world’s most active cryptocurrency markets.

Why does it matter?

Vietnam’s new enforcement framework illustrates how governments are increasingly moving beyond debating whether to regulate cryptocurrencies towards determining how they should be supervised. Licensing regimes, compliance obligations and enforcement mechanisms are becoming central elements of national digital asset policies as authorities seek to balance innovation with financial stability and consumer protection.

The pilot programme could also provide a model for other emerging markets with high levels of crypto adoption. If successful, it may demonstrate how jurisdictions can encourage digital asset innovation while bringing trading activity under domestic regulatory oversight rather than relying on offshore platforms.

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Report highlights crypto’s growing economic footprint in the US

A report commissioned by the National Cryptocurrency Association (NCA) estimates that the US cryptocurrency industry could support around 232,000 jobs and contribute more than US$55 billion to the economy in 2026, highlighting the sector’s growing efforts to demonstrate its broader economic impact.

According to the analysis, crypto companies directly employ around 34,000 full-time workers, with software, blockchain and data engineering accounting for the largest share of jobs, followed by compliance, finance, business operations and management.

The report estimates that the average annual wage across supported employment is about US$133,000, with California, New York and Texas hosting the largest concentrations of crypto-related jobs.

The report estimates that every direct crypto job supports around six additional roles across sectors such as cloud computing, legal services, insurance, housing, transport and hospitality. It argues that recent layoffs at individual crypto firms do not significantly alter the broader economic picture because the findings are based on economy-wide modelling rather than company headcounts.

Why does it matter?

The report reflects a broader effort by the cryptocurrency industry to demonstrate its economic significance as policymakers continue to debate regulation, taxation and investment frameworks. Estimates of employment and GDP contributions can strengthen the sector’s case for supportive policies, although such projections should be considered alongside their underlying assumptions and methodology.

The findings also illustrate how digital asset industries increasingly generate demand beyond blockchain companies themselves, supporting legal, financial, cloud computing and other professional services. As crypto markets mature, their economic footprint is becoming more relevant to wider discussions about digital innovation, employment and industrial policy.

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Russia advances regulated crypto market with new bill

Russia’s State Duma has approved legislation establishing a regulatory framework for digital asset markets moving the country closer to creating a licensed cryptocurrency ecosystem under the supervision of the Bank of Russia.

The bill would move cryptocurrency activity into regulated channels while maintaining restrictions on domestic crypto payments. Licensed financial institutions would be able to provide digital asset services, while Russian companies could use cryptocurrencies for certain cross-border trade transactions. Retail investors would face annual investment limits unless they qualify for higher access categories.

Major Russian banks and financial institutions have already begun preparing custody and trading services in anticipation of the new framework. If enacted, the rules are expected to take effect from September 2026, followed by a transition period allowing firms to obtain licences and adapt their operations.

The bill must still be approved by the Federation Council before being submitted to President Vladimir Putin for signature.

Why does it matter?

The legislation reflects a broader international trend towards bringing cryptocurrency markets under formal regulatory oversight. Rather than prohibiting digital assets outright, governments are increasingly introducing licensing regimes, prudential requirements and supervisory frameworks aimed at integrating crypto activities into the wider financial system.

Russia’s approach is also notable for distinguishing between domestic payments and cross-border transactions, illustrating how cryptocurrencies are increasingly being viewed as strategic financial infrastructure in international commerce. At the same time, the proposed framework raises wider questions about investor protection, financial stability and the interaction between digital asset regulation and international sanctions.

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Movement Labs files for Chapter 11 after MOVE token turmoil

MVMT Labs, the former developer of the Movement blockchain, has filed for Chapter 11 bankruptcy protection in the US Bankruptcy Court for the District of Delaware.

The company submitted a voluntary petition on 15 July under Subchapter V, a streamlined restructuring process available to qualifying small businesses.

Court records show that MVMT Labs reported less than $1 million in assets, between $1 million and $10 million in liabilities and between 200 and 999 creditors. Creditors have until 14 September to submit claims.

The filing follows prolonged controversy surrounding the launch of the MOVE token and a disputed market-making arrangement.

Binance said an authorised market maker sold approximately 66 million MOVE tokens shortly after the token was listed, with few corresponding buy orders. The exchange later removed the market maker and froze proceeds intended for user compensation.

Movement Labs and the Movement Network Foundation said they had not been aware of the market maker’s conduct and opened an investigation into the arrangement.

Coinbase subsequently suspended MOVE trading after concluding that the asset no longer met its listing standards.

The bankruptcy applies to MVMT Labs rather than Move Industries, which took over development and operations of the Movement ecosystem in late 2025 and says the network continues to operate.

The case remains open, with MVMT Labs seeking to restructure under court supervision.

Why does it matter?

The filing shows how controversial token distribution and market-making arrangements can create prolonged governance, reputational and financial risks for blockchain companies. It also highlights the distinction between a decentralised network and the corporate entities involved in developing it, as the bankruptcy concerns MVMT Labs while another company continues operating the Movement ecosystem.

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European Central Bank moves digital euro project into next legislative phase

The European Central Bank (ECB) says the digital euro project has entered a new phase after the European Parliament adopted its negotiating position, allowing trilogue negotiations with other EU institutions to begin.

Speaking in Rome, ECB Executive Board member Piero Cipollone said the digital euro could be introduced in 2029 if the legislative process is completed by the end of 2026. He said the project is intended to complement cash, strengthen Europe’s payments infrastructure and preserve the role of banks in the digital payments ecosystem.

The ECB also announced that a pilot involving 36 payment service providers, including banks and non-bank institutions, will begin in September 2027. The exercise is intended to support technical preparations ahead of any potential launch.

Under the proposed model, banks would distribute the digital euro and maintain customer relationships, while the Eurosystem would continue working with the payments sector to prepare the wider ecosystem for a possible rollout.

Why does it matter?

The adoption of the European Parliament’s negotiating position marks an important step towards establishing the legal framework for the digital euro. If trilogue negotiations conclude successfully, the project will move from design and experimentation towards implementation.

The ECB’s approach also reflects a broader effort to modernise Europe’s payment infrastructure while preserving the role of commercial banks and reducing dependence on non-European payment providers. The digital euro is therefore both a payments initiative and part of the EU’s wider strategy for financial and digital sovereignty.

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Visa explores hybrid future for AI-driven payments

Visa has outlined a future in which traditional card networks and stablecoins play complementary roles in AI-driven commerce. A joint report by Visa and blockchain analytics firm Artemis examines how AI agents are beginning to make payments, drawing on live on-chain data and emerging payment protocols.

The report divides agentic commerce into two broad categories.

In macro-commerce, AI agents act on behalf of people in transactions such as travel bookings, subscriptions or other consumer purchases. Visa says those payments resemble ordinary e-commerce and remain well-suited to card networks.

In micro-commerce, software systems make small and frequent payments to other software systems, often for API access or computing resources.

The report argues that these transactions are often too small for traditional card fees, while newer blockchain rails can support settlement costs of fractions of a cent.

Visa says stablecoins are unlikely to replace cards. Instead, it expects both systems to be used across different parts of the same agentic commerce workflow.

The report also highlights legal and trust challenges.

Existing rules on liability, disputes and payment authorisation were designed for human-controlled transactions, not AI agents that may act on delegated authority and process large numbers of transactions independently.

Visa says payment providers will need infrastructure that combines card-based trust and authorisation with machine-native settlement as agentic commerce develops.

Why does it matter?

Agentic payments could change online commerce by letting AI agents buy services, data, compute and products without constant human approval. Visa’s report suggests that existing card networks may remain useful for larger consumer-facing purchases, while stablecoins and blockchain settlement could support very small, automated machine-to-machine payments. The shift raises unresolved questions over liability, fraud, dispute resolution and consumer protection when autonomous agents act on delegated authority.

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Japan recognises crypto as financial products

Japan has passed amendments that move cryptoasset regulation closer to traditional financial-market oversight.

The changes shift core cryptoasset rules from the Payment Services Act to the Financial Instruments and Exchange Act, treating cryptoassets more like investment products than payment instruments.

The reforms create a clearer legal category for cryptoassets under financial-market rules while introducing stronger investor protection and market-integrity requirements.

They include insider-trading rules for crypto transactions, disclosure obligations for certain cryptoasset issuers and tougher penalties for unregistered businesses.

The legislation also lays the groundwork for separate tax treatment of crypto gains, with a future tax regime expected to reduce the rate to around 20% and allow investors to carry losses forward for three years.

Those tax changes are expected to apply from 2028, depending on implementation rules.

The amendments also create a legal basis for domestic spot cryptocurrency exchange-traded funds, although final approval of specific products has not yet been confirmed.

Implementation will depend on future cabinet ordinances, regulatory guidelines and supervisory practice.

The reforms form part of Japan’s wider effort to align digital assets more closely with financial-market regulation while supporting Web3, investment and digital-asset innovation.

Why does it matter?

Japan’s reforms are significant because they move crypto further into the mainstream financial regulatory framework rather than treating it mainly as a payment-related activity. Insider-trading rules, issuer disclosures and stronger supervision could improve investor protection and market integrity. At the same time, tax and ETF changes may make the market more attractive to institutional and retail investors. The approach also reflects a wider global shift: major economies are increasingly trying to integrate digital assets into regulated financial markets rather than leaving them in a separate or lightly supervised category. Japan’s implementation will be watched closely because it combines stricter oversight with measures that could support market growth.

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South Korea expands blockchain strategy with stablecoin plans

South Korea is keeping blockchain and digital assets on its policy agenda for the second half of 2026, alongside much larger investments in AI and semiconductors.

The government’s plans include work on stablecoin legislation, tokenised financial infrastructure and blockchain-based public-sector pilots.

Authorities are expected to move forward with the proposed Digital Asset Basic Act, which would create a broader legal framework for digital asset businesses and Korean won-backed stablecoins.

The government has also considered rules for cross-border stablecoin transactions and amendments that could support the introduction of spot cryptocurrency exchange-traded funds.

Blockchain adoption is also being tested in public finance. South Korea plans to pilot tokenised government bonds linked to the Bank of Korea’s institutional central bank digital currency project in 2027.

The Bank of Korea is also expected to examine interoperability between its institutional CBDC system and other blockchain networks.

At the local level, Gyeonggi Province is preparing a stablecoin pilot to test government payments, settlement and fraud-prevention technologies.

The plans show that blockchain remains part of South Korea’s digital strategy, even as AI, semiconductors and data-centre infrastructure dominate the country’s broader technology investment agenda.

Why does it matter?

South Korea’s roadmap shows that blockchain policy is moving beyond exchange regulation towards stablecoins, tokenised public finance and institutional digital-asset infrastructure. Clearer rules for won-backed stablecoins and crypto ETFs could increase legal certainty and institutional participation. At the same time, the focus on tokenised government bonds and CBDC interoperability suggests South Korea is exploring how blockchain could fit into public financial infrastructure, not only private crypto markets.

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