Global Regulation

On 10 January 2025, the Hong Kong Securities and Futures Commission (HK SFC) issued a public warning against “iSCAT Exchange,” an unlicensed virtual asset trading platform operating unlawfully under Hong Kong regulations.

On 12 December 2024, the Bank for International Settlements (BIS) published FSI Insights No. 63, titled “Regulating AI in the Financial Sector: Recent Developments and Main Challenges.” The report examines and elaborates on the rapid adoption of AI in banking and insurance sector, highlighting its transformative potential and associated risks. It outlines a regulatory framework to balance innovation with financial stability, addressing governance, ethical concerns, and sustainability challenges.

On 18 December 2024, the Swiss Financial Market Supervisory Authority (FINMA) published Guidance 08/2024 on governance and risk management for supervised financial institutions using artificial intelligence (AI). The guidance addresses operational, legal, and reputational risks posed by AI while reinforcing oversight practices in Switzerland’s financial sector.

On 12 December 2024, the Australian Federal Court, in its judgment Australian Securities and Investments Commission v Bit Trade Pty Ltd 2024 FCA 1422, ordered Bit Trade Pty Ltd, the Australian operator of the Kraken cryptocurrency exchange, to pay AUD 8 million in penalties. The decision followed legal proceedings initiated by the Australian Securities and Investments Commission (ASIC), which found Bit Trade unlawfully issued a margin trading product to over 1,100 retail clients without meeting critical regulatory obligations under the Australian Corporations Act 2001 (Cth).

On 5 December 2024, the Monetary Authority of Singapore (MAS) released an information paper to provide good practices for Artificial Intelligence (AI) and Generative AI risk management in banking. Based on findings from a thematic review conducted in mid-2024, the paper outlines governance frameworks, risk management systems, and development protocols that banks and financial institutions are encouraged to adopt for responsible AI deployment.

On 6 December 2024, the Hong Kong Government announced the publication of the Hong Kong Stablecoins Bill in the Gazette. The Hong Kong Stablecoins Bill is scheduled for its first reading in the Legislative Council of Hong Kong on 18 December 2024.The Hong Kong Stablecoins bill aims to establish regulatory framework for fiat-referenced stablecoins.

On 16 October 2024, Germany’s Federal Financial Supervisory Authority (BaFin) published a study examining the influence of financial influencers (“finfluencers”) on investment decisions among adults aged 18 to 45. The report discusses the role of social media in shaping financial behaviours, especially among GenZ, and addresses the risks associated with this trend.

On 7 November 2024, Latvijas Banka announced updates to its Guidelines on the Establishment of the Internal Control System for Anti-Money Laundering and Countering Terrorism and Proliferation Financing and Sanctions Risk Management, and on Customer Due Diligence, aiming to enhance compliance and understanding of financial crime prevention across Latvia’s financial sector.

On 28 October 2024, the Hong Kong Monetary Authority (HKMA) announced a collaboration with Banco Central do Brasil (BCB) to drive cross-border tokenisation innovation, linking Hong Kong’s Project Ensemble Sandbox and Brazil’s Drex CBDC pilot programme. This partnership aims to establish standards in digital finance, targeting areas like trade finance and carbon credit settlement.

On 30 October 2024, the Monetary Authority of Singapore (MAS) introduced updates to Singapore’s Payment Services Act (SG PSA) under its National Anti-Money Laundering strategy, aimed at strengthening regulations for digital payment token (DPT) service providers.

On 22 October 2024, the U.S. Court of Appeals for the Second Circuit issued a Default Notice concerning procedural non-compliance by Ripple Labs’ legal team. Under Local Rule 12.3, Ripple’s counsel was required to file an Acknowledgment and Notice of Appearance by 18 October 2024 for continued involvement in the appellate process. However, as of the notice date, Ripple’s legal team had not submitted this filing, prompting the court to issue the notice and outline potential restrictions if compliance is not met.

On 10 October 2024, Gary Gensler, Chair of the United States Securities and Exchange Commission (US SEC), addressed the growing risks of fraud in relation to artificial intelligence (AI) and its application in finance. In his statement he discussed and emphasised that while AI presents opportunities, it also introduces new challenges for investor protection, with a focus on three categories of harm: programmable, predictable, and unpredictable.