Crypto Assets at the Crossroads: The Urgent Need for Unified Global Regulation

• Crypto’s Evolution from the Fringe to the Core of Global Finance
• Christine Lagarde Calls for Coordinated Global Action on Crypto Risks
• IMF and Global Institutions Warn of Systemic Threats from Crypto Growth
• Surge in Bitcoin and Stablecoin Use Signals Widespread Acceptance—and Risk
• Without Clear Rules, Crypto Could Destabilize Emerging Economies
• India’s Passive Stance Raises Concerns Despite G20 Leadership Role
• The Goal of Regulation: Safe, Transparent, and Sustainable Innovation

In a world increasingly shaped by geopolitical tensions, ideological divides, and economic instability, crypto assets have moved far beyond their experimental roots. Once seen as niche innovations operating at the margins of the global financial system, these assets are now rapidly becoming central players in global finance.

Christine Lagarde Calls for Coordinated Global Action on Crypto Risks

European Central Bank (ECB) President Christine Lagarde underscored this shift during the International Monetary and Financial Committee (IMFC) meeting in April 2025. She urged global policymakers to take the challenges posed by crypto assets seriously and to strengthen cross-border cooperation. Lagarde emphasized the importance of adopting prudent financial policies and reinforcing collective efforts toward global crypto regulation.

IMF and Global Institutions Warn of Systemic Threats from Crypto Growth

Lagarde’s concerns echo those of several global regulatory bodies including the Bank for International Settlements (BIS), International Monetary Fund (IMF), Financial Stability Board (FSB), and Basel Committee on Banking Supervision (BCBS). These institutions have repeatedly warned that the rise of stablecoins, decentralized finance (DeFi), and institutional crypto investments has elevated crypto-related risks to a systemic level. They argue that only globally coordinated policymaking can effectively mitigate these threats.

Surge in Bitcoin and Stablecoin Use Signals Widespread Acceptance—and Risk

The IMF’s Global Financial Stability Report (GFSR), released in April 2025, provides a clearer picture. Since late 2024, Bitcoin has yielded substantial returns, with investments in Bitcoin-based Exchange-Traded Products (ETPs) surpassing $100 billion. This growth reflects growing acceptance among both retail and institutional investors. At the same time, the total market value of stablecoins has crossed $200 billion, driven largely by optimism around potential crypto regulations in the U.S.

Yet this rapid expansion has reintroduced volatility. Bitcoin prices have fallen nearly 25% from their 2025 peak. The IMF notes a growing correlation between crypto markets and traditional stock markets—an indication that crypto volatility now has the potential to directly impact broader financial systems.

Without Clear Rules, Crypto Could Destabilize Emerging Economies

The IMF warns that the unregulated proliferation of crypto—particularly in developing and emerging markets—could lead to capital flight, the erosion of monetary sovereignty, and increased risk of illicit financial activity. To counter these dangers, the IMF advocates for clearly defined regulatory frameworks, tighter oversight of tokenization, and alignment with the joint FSB–IMF global roadmap.

India’s Passive Stance Raises Concerns Despite G20 Leadership Role

While many countries are actively engaging in crypto regulatory efforts, India’s relative silence on the matter is both surprising and potentially risky. Despite implementing certain measures on taxation and anti-money laundering, the country has yet to introduce a comprehensive regulatory framework or articulate a clear policy vision. This lack of clarity is particularly concerning given India’s leadership role in the G20’s crypto regulation roadmap.

The Goal of Regulation: Safe, Transparent, and Sustainable Innovation

It’s essential to recognize that effective regulation isn’t about stifling innovation—it’s about guiding it safely and sustainably. The real question today isn’t whether crypto should be regulated, but how. The right regulatory approach can ensure not only national but global financial stability, while encouraging responsible innovation in the rapidly evolving crypto space.