As of April 2026, major jurisdictions including the United States, European Union, Hong Kong, and Singapore have largely finalized their digital asset regulatory frameworks, marking the industry’s transition from an exploratory phase to comprehensive compliance. On April 28, 2026, CertiK released its "State of Digital Asset Regulation 2026" report, systematically outlining these shifts. The report highlights that anti-money laundering (AML) enforcement has overtaken securities classification as the primary regulatory risk, and that smart contract security audits are evolving from industry best practice to a mandatory requirement for licensing and token listing.
Why Has AML Enforcement Overtaken the SEC as the Top Regulatory Risk for the Crypto Industry?
CertiK’s report identifies 2025 as a pivotal year for regulatory focus. The U.S. Securities and Exchange Commission (SEC) significantly scaled back its enforcement efforts related to crypto assets, initiating only 13 crypto-related actions in 2025—a 60% decrease from 33 actions in 2024, and the lowest since 2017. In terms of fines, SEC penalties for crypto assets plummeted by an extraordinary 97% year-over-year, totaling $142 million in 2025 compared to approximately $490 million in 2024.
In stark contrast, the U.S. Department of Justice (DOJ) and Financial Crimes Enforcement Network (FinCEN) imposed over $900 million in AML-related fines and settlements in the first half of 2025 alone. Some media sources even report figures exceeding $1.06 billion. Meanwhile, AML fines in Europe surged by 767% during the same period, and crypto transactions linked to sanctions grew by more than 400% year-over-year. This dramatic shift—declining SEC actions and rising AML enforcement—clearly signals that AML enforcement has fully replaced the SEC’s prior securities-focused approach.
How Has Enforcement Leadership Shifted from the SEC to DOJ and FinCEN?
This shift in regulatory focus is no accident, but rather the result of changes in policy direction and enforcement logic. After President Trump appointed Paul Atkins as SEC Chair in 2025, the SEC rapidly adjusted its enforcement strategy: of the 13 new crypto enforcement actions that year, five originated from cases launched under former Chair Gensler, and only eight were initiated during Atkins’ 11-month tenure. The SEC withdrew from several lawsuits against major exchanges, including partial enforcement actions against Coinbase and Binance that were paused or dropped. The regulatory approach is moving away from broad information disclosure and securities classification ("substance over form") toward a "technology-neutral, conduct-based" AML framework.
At the same time, DOJ and FinCEN are leveraging the Bank Secrecy Act (BSA) and unlicensed money transmission regulations to fill the enforcement vacuum left by the SEC. In the first half of 2025, OKX reached a $504 million settlement with DOJ, and KuCoin paid $297 million—both cases involving unlicensed money transmission and BSA violations. DOJ cited over $5 billion in suspicious fund flows in the OKX case, directly pointing to deficiencies in transaction monitoring and suspicious activity reporting. The enforcement focus has shifted from theoretical debates over whether an asset is a security to practical concerns about whether transaction funds are clean and whether monitoring systems are effective.
How Are Smart Contract Audits Evolving from Best Practice to Mandatory Entry Requirement?
CertiK’s report lists the elevation of smart contract security audits as one of the four core changes in global regulation. Currently, seven jurisdictions—Hong Kong, UAE (VARA and ADGM), Singapore, EU, Brazil, Turkey, and the U.S. (New York State, NYDFS)—have implemented statutory or quasi-statutory audit requirements. For example, Hong Kong mandates smart contract security audits for stablecoin issuers, Dubai’s Virtual Asset Regulatory Authority requires licensed entities to conduct regular audits and penetration tests, and Brazil’s central bank makes independent technical certification (covering cybersecurity, segregated custody, and key management systems) a mandatory condition for virtual asset service provider licenses. The EU’s Digital Operational Resilience Act (DORA) imposes enhanced ICT risk management and security testing obligations on financial institutions and related service providers.
Industry data supports the necessity of mandatory audits. CertiK’s analysis of the 100 most severely attacked protocols found that 80% had never undergone formal security audits prior to being compromised, and these unaudited protocols accounted for 89.2% of total losses. By loss type, infrastructure-level issues like private key leaks and access control failures now account for 76% of value lost, surpassing traditional code vulnerabilities. This shows that regulatory expectations for security audits are expanding from simple code review to comprehensive assessments including key management, access control, and operational security. Security audits are no longer a "one-off" pre-launch task, but an ongoing compliance cost for licensed operations.
How Are the GENIUS Act and MiCA Framework Shaping the Global Regulatory Landscape in 2026?
Global stablecoin regulation is rapidly converging around two principles: "fully backed reserves" and "licensed issuance." In the U.S., the GENIUS Act was signed into law in July 2025, establishing a federal regulatory framework for payment stablecoins. Issuers must obtain licenses via banking channels or federally qualified non-bank routes, with reserve assets limited to cash, regulated deposits, short-term U.S. Treasuries, and other highly secure assets, and are explicitly prohibited from paying interest to holders. In the EU, under the Markets in Crypto-Assets (MiCA) framework, stablecoin provisions are now fully in effect—single fiat-backed stablecoins are classified as electronic money tokens and subject to corresponding requirements, while significant tokens face additional capital, liquidity, and reporting obligations.
Despite these advances, cross-jurisdictional compliance gaps remain significant. The U.S. "bank-led model," EU’s "open licensing model," and Hong Kong’s "licensing regime" differ fundamentally in reserve standards, governance frameworks, and regulatory authority. This means digital asset service providers operating in multiple jurisdictions must establish separate legal entities, compliance structures, and audit systems for each region, substantially increasing compliance costs and operational friction. CertiK’s report identifies this cross-border compliance asymmetry as a core industry challenge, noting that multi-jurisdiction licensing capability will become a key competitive barrier among institutional players.
What Structural Signals Does the 2021–2025 Enforcement Curve Reveal?
Reviewing SEC enforcement trends from 2021 to 2025, 2023 marked the peak—47 crypto-related actions were initiated, with up to 101 lawyers leading crypto investigations. In 2024, SEC actions dipped slightly to 33, but fines still reached about $470 million. In 2025, all three metrics dropped sharply: enforcement actions fell to 13 (down 60%), fines plunged to $142 million (down 97%), and the number of lawyers handling crypto investigations dropped to 33—the lowest since 2017. This "cliff-edge" decline coincides with DOJ/FinCEN’s AML fines exceeding $900 million, signaling a structural handover of regulatory authority and marking the transition from "SEC dominance" to "multi-agency governance" in U.S. crypto regulation.
Meanwhile, the Basel Committee’s prudential standards for crypto assets took effect on January 1, 2026: Group 2 assets (including BTC and ETH) face nearly 100% capital requirements, while Group 1 assets (tokenized traditional instruments and qualifying stablecoins) are subject to standard risk weights. This global banking capital framework will have profound structural impacts on the liquidity of different crypto asset classes at the institutional level.
How Should Exchanges and Projects Build a Compliance Framework for 2026?
As regulation shifts from "whether to comply" to "how to implement compliance capabilities," industry participants must go beyond surface-level policy interpretation and develop executable systems. CertiK’s report recommends advancing compliance capability across four key dimensions.
First, implement comprehensive AML system upgrades. Establish standardized transaction monitoring, suspicious activity reporting, and sanctions screening systems. In the first half of 2025, the combined fines for OKX and KuCoin approached $800 million, setting a benchmark for penalties tied to inadequate transaction monitoring. This scale now matches some past securities fraud cases, fundamentally changing the ROI logic of compliance—compliance costs rising to the 1% range of fixed operating expenses are now the norm in the era of strong compliance.
Second, upgrade security audits from a one-time operation to a continuous requirement throughout the licensing cycle. License maintenance conditions in multiple jurisdictions now include regular security assessments, such as Dubai VARA’s annual smart contract audit requirement. CertiK’s analysis of the top 100 attacked protocols shows unaudited protocols account for 89.2% of losses, illustrating the extreme consequences of neglecting audits. Enterprises aiming for large-scale operations in payments, stablecoins, or regulated trading must integrate audits into product design and adopt a Security-by-Design methodology for ongoing investment.
Third, design redundancy for cross-jurisdictional compliance differentiation. GENIUS’s bank-led path, MiCA’s open licensing logic, and Hong Kong’s licensing regime differ greatly in reserve rules, governance structures, and operational procedures. Companies planning global expansion should establish independent local legal entities in advance and design parallel compliance systems to meet diverse regional regulatory requirements, avoiding piecemeal fixes that lead to unnecessary costs and compliance risks.
Fourth, incorporate institutional-grade security operations into the compliance framework. With infrastructure security incidents now accounting for 76% of losses, regulators’ expectations for licensed entities extend beyond code audits to comprehensive assessments of key management, access control, and operational resilience. Companies must simultaneously build internal operational security management and emergency response systems.
Conclusion
CertiK’s 2026 global digital asset regulation report provides a clear panorama of the industry’s "era of strong compliance." AML enforcement and smart contract audits are emerging as two core pillars, propelling global crypto regulation from "soft constraints" to "hard mandates." The structural contraction of SEC enforcement, coupled with DOJ/FinCEN’s robust intervention and more than $900 million in fines, marks the shift in enforcement leadership from "securities classification debates" to "fund flow monitoring and compliance system implementation." The global regulatory landscape, shaped by GENIUS, MiCA, and Hong Kong’s Stablecoin Ordinance, is largely in place, but cross-jurisdictional compliance "fragmentation" may further raise licensing thresholds. The central challenge for exchanges and projects is no longer "whether to comply," but "how to rapidly and systematically build compliance as an institutional capability."
FAQ
Q: What is the biggest regulatory risk facing crypto companies in 2026?
According to CertiK’s report, AML enforcement is now the primary regulatory risk. In the first half of 2025 alone, AML-related fines exceeded $900 million, while SEC crypto penalties dropped 97% year-over-year, reflecting a complete shift in enforcement focus.
Q: Has smart contract auditing become a mandatory requirement?
Yes. Seven jurisdictions—including Hong Kong, UAE (VARA), Singapore, EU (DORA), Brazil, Turkey, and New York State in the U.S.—have implemented statutory or quasi-statutory audit requirements. Audit records and quality are now core criteria for obtaining and maintaining licenses.
Q: What is the significance of the OKX and KuCoin fine cases?
The two cases totaled nearly $800 million and involved unlicensed money transmission and BSA violations. They demonstrate that transaction monitoring and suspicious activity reporting have become core regulatory risks for exchanges, no longer mere routine internal controls.
Q: What are the main differences between the GENIUS and MiCA frameworks?
GENIUS uses a "bank-led" licensing path, requiring issuers to obtain licenses via banking channels, restrict reserves to highly secure assets, and prohibit interest payments. MiCA distinguishes between electronic money tokens and asset-referenced tokens, allowing non-bank issuers to operate within the EU regulatory framework and supporting multi-currency issuance and staking scenarios.
Q: Where should enterprises prioritize compliance construction right now?
It is recommended to advance in three areas simultaneously: build comprehensive AML transaction monitoring, integrate security audits into the product development lifecycle and ensure continuity, and prepare independent legal governance and compliance systems for multi-region operations. Compliance is no longer just a risk mitigation tool, but a core condition for licensing and ongoing business operations.
