Week 43, October 12–18, 2026
Key cryptocurrencies closed in the red. That did not stop regulators from building out oversight of the industry, moving ahead of politicians who continue to drag their feet on legislation. Stablecoins have grown large enough to come under systemic “banking” supervision, even as market growth itself slows. Governments are forcing crypto holders to operate through licensed intermediaries: blocking offshore exchanges, banning P2P transactions, and requiring disclosure of personal wallets. Meanwhile, the political track in the United States is falling apart. The White House crypto council is now empty, the market-structure bill has little chance of becoming law in the near future, and the derivatives regulator is expanding its powers without Congress.
Stablecoins are getting banking supervision, but losing growth momentum. Stablecoins are increasingly being treated like money. On October 14, the European Banking Authority (EBA) recognized Circle’s USDC as the EU’s first “significant” stablecoin: starting November 12, its reserves and liquidity will come under EBA supervision. USDT, with a market cap of $183.7 billion, does not meet European requirements. On October 12, Financial Stability Board (FSB) Chair Andrew Bailey warned the G20 that cross-border supervision of stablecoins remains unfinished. A draft from the U.S. Financial Accounting Standards Board (FASB), open for comments until November 19, classifies stablecoins with a direct redemption right from the issuer as cash equivalents. Market growth is slowing, too: Standard Chartered has pushed its forecast for stablecoin market capitalization reaching $2 trillion from 2028 to 2030, versus $309 billion today.
From Seoul to Paris, cryptocurrencies are being cut off from regulatory loopholes. The space for crypto outside the regulator’s line of sight is shrinking. On October 12, Russia’s central bank announced that direct P2P crypto transactions between individuals will be banned starting July 1, 2027. Individuals will also be barred from transferring crypto assets from digital accounts to their own cold wallets. That same day, the central bank allowed Sberbank to exchange cryptocurrencies. On October 13, South Korea announced it was blocking the websites of 27 unregistered crypto exchanges, including KuCoin and MEXC. Bitget, one of the few major exchanges that had worked with Russians, said that as of October 18 it would ban new transactions for users from Russia, Belarus, and Kazakhstan who had received notices. France’s National Assembly finance committee added a requirement to the 2027 budget bill: holders must declare crypto assets in personal wallets worth more than 100,000 euros ($113,000).
In the United States, crypto rules are being written through definitions rather than laws. The legislative path to a U.S. crypto regime is closing, and regulators are acting on their own. Patrick Witt, head and the last staff member of the White House crypto council, confirmed his departure on October 14. He had been promoting CLARITY, the bill on crypto market structure: Polymarket puts the odds of it being enacted in 2026 at 6%. Ahead of a Supreme Court dispute, the U.S. Commodity Futures Trading Commission (CFTC) defined sports, political, cultural, and weather event contracts as swaps, excluding them from the definition of gambling. Commission Chair Michael Selig said such contracts are derivatives under the CFTC’s exclusive jurisdiction. Former CFTC Chair Caroline Pham said the broad definition of “commodity” allows the commission to regulate markets without Congress.