Cryptocurrencies Archives | Page 2 of 172 | Digital Watch Observatory

Dubai opens government payments to crypto users

Dubai residents will be able to pay government fees using virtual assets after Crypto.com’s UAE entity, Foris DAX Middle East FZE, received a Stored Value Facilities licence from the Central Bank of the UAE.

Crypto.com said the approval makes it the first Virtual Asset Service Provider in the UAE to receive the licence. It allows the company to activate its partnership with the Dubai Department of Finance, enabling virtual asset payments for government services.

Financial settlements will be conducted in UAE dirhams or Central Bank-approved dirham-backed stablecoins through the regulated Stored Value Facilities framework. Crypto.com said the arrangement supports the Dubai Cashless Strategy.

Users wishing to access the service will need to be onboarded through Crypto.com’s VARA-licensed platform. The company also said that, subject to further Central Bank approvals, the licence could support crypto payment integrations with Emirates and Dubai Duty Free.

Crypto.com executives described the approval as a step towards regulated digital asset adoption in the UAE, while linking it to the country’s wider push for compliant crypto infrastructure and digital payments innovation.

Why does it matter?

The development shows how Dubai is moving virtual asset payments closer to public-sector infrastructure, rather than treating them only as investment products or private-sector payment experiments. By routing payments through a regulated Stored Value Facilities framework and settling them in dirhams or approved dirham-backed stablecoins, the model links crypto access with conventional payment oversight, financial regulation and the emirate’s cashless economy strategy.

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Chainalysis points to rising adoption of blockchain forecasting

Crypto prediction markets are expanding rapidly as blockchain technology reshapes how users speculate on and hedge against real-world events, according to blockchain analytics firm Chainalysis.

Platforms that allow traders to take positions on elections, interest rates, sports and geopolitical developments have attracted both retail users and institutional firms, pushing the sector towards a more mature financial structure. Chainalysis says activity has grown sharply since late 2024, with inflows reflecting both retail participation and deposits from market makers.

The firm says major financial and crypto companies are increasingly building infrastructure around event-based contracts. It points to the involvement of major financial institutions and crypto platforms such as Robinhood, Coinbase and Crypto.com, which are exploring or launching prediction market offerings.

Chainalysis argues that blockchain transparency could help prediction markets address compliance and market-integrity risks by recording transactions on public ledgers. The firm says that visibility can support investigations into money laundering, sanctions exposure, wash trading, insider trading and market manipulation.

Regulatory uncertainty nevertheless remains a major obstacle. In the United States, regulators and state authorities continue to debate whether some prediction markets should be treated as financial derivatives or gambling products. Chainalysis also notes that several jurisdictions in Europe, Asia-Pacific and Latin America have restricted or blocked major prediction market platforms.

The firm argues that stronger blockchain-based monitoring tools could help regulators and compliance teams support responsible innovation while reducing financial crime and market abuse risks.

Why does it matter?

The growth of crypto prediction markets points to a wider convergence between digital finance, public forecasting and event-based speculation. Institutional interest suggests the sector is moving beyond retail betting, but unresolved questions over gambling law, derivatives regulation, market manipulation and the use of non-public information will shape whether these platforms become a recognised part of financial markets or remain legally fragmented.

Chainalysis also raises a broader governance question: whether public-ledger transparency can make crypto-native markets easier to monitor than traditional betting or derivatives systems, or whether global accessibility and fragmented oversight will create new risks for regulators.

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European Central Bank moves forward with digital euro technical work

The European Central Bank is advancing technical work on the digital euro, a proposed electronic form of central bank money designed to complement cash in an increasingly digital payments landscape.

The project reflects Europe’s response to the rapid shift towards digital payments, where cards, apps and mobile wallets are increasingly used for everyday transactions. The ECB says a digital euro would provide a European payment option that could be used across the euro area, both online and offline.

Users would be able to store digital euro holdings in an account set up with a bank or public intermediary and use them for in-store, online and person-to-person payments. The ECB says the system would aim to combine the convenience of digital payments with features associated with cash, including offline functionality.

Policy objectives include strengthening Europe’s strategic autonomy in payments, supporting monetary sovereignty and ensuring access to public money in digital form. The ECB has also presented privacy as a central design feature, saying offline digital euro payments would offer cash-like privacy, with transaction details known only to the payer and the recipient.

The project remains conditional on the EU legislative process. The ECB aims to be technically ready for a potential first issuance of the digital euro in 2029, assuming the necessary EU legislation is adopted in 2026.

Supporters view the digital euro as a way to preserve the role of central bank money in digital payments and reduce reliance on non-European payment providers. Debate continues over how to balance innovation, privacy, financial inclusion, bank intermediation and public trust.

Why does it matter?

The digital euro would shape how public money functions in a digital economy increasingly dominated by private payment platforms and international card schemes. Its significance lies not only in creating a new payment tool, but in preserving access to central bank money, supporting European payment sovereignty and setting privacy expectations for public digital infrastructure.

Its success will depend on whether the final design can offer clear benefits over existing payment options while maintaining trust, usability and strong safeguards. The project also raises broader questions about how central banks remain relevant in everyday payments without crowding out private-sector innovation or weakening the role of commercial banks.

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Italy central bank backs review of tokenised SEPA payments

European policymakers are increasingly examining how traditional payment systems could evolve in response to the rise of digital assets. Bank of Italy Deputy Governor Chiara Scotti has suggested that the Single Euro Payments Area (SEPA) could be extended to tokenised payments to support Europe’s digital finance infrastructure.

Scotti described a tokenised SEPA framework as an important area for consideration, highlighting that Europe’s existing payments system already offers strong interoperability and shared standards.

Her remarks align with broader efforts by the European Central Bank to integrate distributed ledger technology into settlement systems.

The European Central Bank is currently developing initiatives such as Pontes, a pilot linking blockchain-based market platforms with central bank settlement infrastructure, alongside a longer-term roadmap known as Appia.

These projects aim to ensure euro-denominated settlement remains central as tokenised deposits and digital assets expand.

Policymakers warn that widespread stablecoin adoption could shift deposits away from banks, weakening financial stability and reducing the euro’s influence in digital markets. As a result, central bank money is being considered as a key anchor for future tokenised financial systems.

Why does it matter?

The debate reflects Europe’s effort to maintain control over its monetary system as payments move toward tokenised and blockchain-based infrastructure. Without central bank money integrated into these systems, risks include weaker financial stability, fragmented payment networks, and greater reliance on external stablecoin ecosystems, potentially reducing the euro’s role in digital finance.

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MoneyGram and Kraken connect crypto and cash globally

Kraken has entered a strategic partnership with MoneyGram to enable crypto-to-cash withdrawals in more than 100 countries. The integration links digital asset infrastructure with MoneyGram’s global network, allowing users to convert crypto into hundreds of fiat currencies through physical and digital payout channels.

The service is intended to address one of the main barriers to crypto adoption by improving access to reliable off-ramps. Users will be able to transfer funds to their accounts and receive near-instant cash payouts through MoneyGram’s retail network and regulated payment infrastructure.

Both companies highlighted the importance of interoperability between traditional finance and digital assets in driving practical adoption.

Kraken stressed the value of connecting liquidity and compliance systems with established payment rails, while MoneyGram presented its global distribution network as a bridge between digital value and everyday financial use.

The rollout will begin across the United States, Europe, Latin America, Africa, and parts of Asia-Pacific, with plans to expand further into local bank deposits and additional payment services as the partnership develops.

Why does it matter?

The partnership addresses one of the main friction points in crypto adoption: converting digital assets into usable cash at scale. By linking crypto infrastructure with a global payout network, it strengthens the practical use of digital assets beyond trading and speculation.

More broadly, it reflects a gradual convergence between traditional financial rails and crypto-native systems, with interoperability becoming increasingly important to how value moves across borders.

It may also support financial inclusion by expanding access to cash-out services in regions where banking infrastructure remains limited or uneven.

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Western Union launches USD-backed stablecoin for cross-border payments

Western Union has announced the launch of USDPT, a US dollar-denominated stablecoin intended to support its global payments infrastructure. The company said the token is fully backed by US dollars and issued by Anchorage Digital Bank, running on Solana to enable faster and more efficient settlement.

The stablecoin is intended to function as an always-on settlement asset within Western Union’s global network. By using Solana’s high-performance infrastructure, Western Union said USDPT is intended to reduce delays and inefficiencies in traditional correspondent banking while maintaining regulatory compliance and oversight.

Integration plans include exchange availability, liquidity connections with licensed custodians, and internal settlement for agents and treasury operations, the company said. Western Union also plans a consumer service and broader digital asset access, positioning USDPT as a bridge between blockchain systems and everyday financial use.

Why does it matter?

The initiative reflects a wider shift among established financial institutions towards regulated digital assets as core payment infrastructure. By combining blockchain settlement with a global payments network, Western Union is positioning itself for real-time, digital-first international money movement.

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Meta taps blockchain networks for faster creator payments

Meta has introduced USDC payouts for selected Facebook creators in Colombia and the Philippines, marking another step towards using blockchain-based payment rails for creator earnings. The programme allows eligible users to receive funds directly into crypto wallets using Polygon or Solana as settlement networks.

Creators receiving USDC on Polygon can move funds through supported wallets or exchanges and convert them into local currency where off-ramp services are available. The model reduces reliance on traditional cross-border payment channels and is intended to give creators faster and more flexible access to dollar-denominated earnings.

Polygon has been included alongside Solana as part of the payout infrastructure, with Polygon arguing that its network already handles a large share of global USDC transfer activity. Low transaction costs and broad wallet and exchange support are presented as key reasons stablecoin rails are becoming more attractive for recurring digital payouts.

Why does it matter?

The significance of the move lies less in crypto branding than in payment infrastructure. Meta is testing whether stablecoin rails can make creator payouts faster, more flexible, and less dependent on the frictions of traditional cross-border transfers. If this model scales, it would suggest that blockchain networks are becoming useful not only for trading or speculation, but for mainstream platform payments where speed, settlement, and access to dollar-denominated value matter.

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Brazil restricts use of cryptoassets for cross-border payment settlement

Brazil’s central bank has introduced new restrictions preventing regulated cross-border payment providers from using cryptoassets to settle international transactions. The measure forms part of updated rules for electronic foreign exchange services, known as eFX.

Under Resolution BCB No. 561, settlement between eFX providers and foreign counterparties must take place through authorised foreign exchange transactions or non-resident Brazilian real accounts. Use of virtual assets such as stablecoins or cryptocurrencies for settlement is explicitly prohibited.

The rule does not ban crypto trading or peer-to-peer transfers, but focuses on the infrastructure used by regulated payment firms. Stablecoin-based settlement models are expected to be most affected, as they have been widely used to facilitate faster and lower-cost cross-border payments.

The decision aligns with Brazil’s broader regulatory strategy to tighten oversight of digital assets, including AML compliance, taxation frameworks, and classification of certain crypto flows as foreign exchange operations.

Regulators aim to maintain control over cross-border capital movement while allowing crypto activity to continue outside regulated payment rails.

Why does it matter?

Brazil’s decision reflects a broader global effort to reassert control over cross-border financial infrastructure as crypto-based settlement systems grow in scale and speed.

By keeping regulated payment flows within traditional foreign exchange channels, authorities aim to preserve monetary oversight, tax visibility, and compliance enforcement in a system where stablecoins are increasingly bypassing conventional banking rails.

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Cross-border crypto transfers in South Korea face stricter compliance requirements

South Korea has advanced a major regulatory shift by passing a bill that extends the Foreign Exchange Transactions Act to cover virtual asset service providers. The decision introduces mandatory registration for firms facilitating cross-border crypto transactions, including exchanges and wallet operators.

The new framework establishes formal oversight of virtual asset transfers between South Korea and other jurisdictions. Authorities will gain enhanced monitoring powers over transaction flows, with a focus on improving transparency and reducing risks linked to illicit financial activity and capital movement.

Major exchanges and service providers are expected to face increased compliance requirements, including detailed reporting obligations and system upgrades. Failure to comply could result in penalties or revocation of registration, signalling a stronger enforcement environment.

The measure aligns South Korea with global regulatory developments such as the EU’s MiCA framework and FATF recommendations. By integrating crypto oversight into existing forex law, regulators aim to accelerate implementation while reinforcing market trust and institutional oversight.

Why does it matter?

South Korea’s move reflects a broader global shift toward integrating crypto into traditional financial regulatory systems, reducing the space for unmonitored cross-border capital flows.

By embedding virtual assets within existing forex law, the country strengthens financial oversight while signalling how digital assets are increasingly being treated as part of mainstream monetary infrastructure rather than a parallel system.

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Crypto crackdown intensifies in Kazakhstan over illegal exchanges

Kazakhstan’s financial regulator has warned that several major cryptocurrency exchanges are operating without the licences required under the country’s current digital asset framework, reinforcing its strict authorisation regime.

The Astana Financial Services Authority identified prominent platforms, including HTX, Bitget, OKX, and MEXC, as operating without the necessary permits. Under existing rules, only entities licensed within the Astana International Financial Centre are allowed to provide regulated digital asset services.

Authorities stressed that international popularity does not exempt platforms from complying with local law. They also warned that unauthorised exchanges can expose users to financial losses, data breaches, and fraudulent schemes, and urged the public to verify platforms through the official register of licensed firms. AFSA’s website currently shows a regulated ecosystem with dozens of authorised entities across the AIFC framework.

The warning comes amid broader enforcement efforts as Kazakhstan tries to formalise its crypto sector while positioning itself as a regulated regional hub for digital assets. In parallel, law enforcement agencies have reported wider crackdowns on illegal crypto activity, including shadow exchanges and money-laundering networks.

Why does it matter?

Kazakhstan’s tightening enforcement shows a broader push to bring crypto activity into a more formal and supervised market structure. By restricting unlicensed platforms and steering users towards authorised entities, the authorities are trying to reduce exposure to financial crime, improve market transparency, and build credibility for Kazakhstan’s ambition to become a regulated regional digital asset hub.

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