What happened? The G20’s Financial Stability Board warned that privacy and data laws are blocking global regulators from properly overseeing crypto.
The FSB published a 107‑page peer review saying inconsistent national rules and strict privacy protections are preventing regulators from sharing transaction and risk data across borders. That lack of access means authorities can’t spot or act on systemic risks quickly. The board urged countries to close data gaps and strengthen cooperation to avoid fragmented oversight.
Who does this affect? Regulators, crypto firms, institutions, and everyday users are all caught up in the clash between privacy and supervision.
National regulators struggle to supervise cross‑border crypto activity, crypto companies face uneven rules and can exploit weaker jurisdictions, and exchanges and stablecoin issuers may be pushed to relocate. Institutional investors and large firms remain wary of on‑chain transparency, slowing mainstream adoption. Ordinary users could see stricter rules or reduced access as governments tighten controls to get data they need.
Why does this matter? It matters for markets because fragmented oversight and data blind spots increase systemic risk, regulatory arbitrage, and investor uncertainty.
When regulators can’t cooperate or share reliable data, risks can build unnoticed and shocks can spread across borders, raising the chance of sudden volatility. Firms moving to lax jurisdictions create uneven competition and regulatory uncertainty that scares off big institutional money. Fixing these gaps — or failing to — will shape adoption, liquidity, compliance costs, and ultimately price stability in crypto markets.