Article language: English.
Abstract
Currently, in various jurisdictions and unions, legislation on cryptocurrencies remains insufficiently adapted to respond to the constantly evolving threats that undermine the foundations of the cryptosphere. The lack of standardisation of laws, both domestically and internationally, contributes to the weakness and fragmentation of existing regulatory frameworks. In response to these shortcomings, this paper aims to propose a guiding framework for a global legal structure. The main objective of the proposal is to minimise the complexities arising from the interaction of multiple legal systems in cross-border cryptocurrency-related insolvency cases and, consequently, to reduce the overall number of such insolvencies. The paper also highlights the existing differences between developed and developing countries in terms of legal implementation, emphasising the importance of designing simpler and more practical legislative approaches for developing countries, particularly given their resource constraints. Furthermore, the paper analyses the legal frameworks of six different jurisdictions – the United States, the United Kingdom, the European Union, France, Kenya, and Singapore, and evaluates their effectiveness in managing risks associated with cryptocurrencies. It also presents specific recommendations and guiding principles addressing four major risks: market manipulation, partially backed stablecoins, money laundering and terrorist financing, and theft. A comparative analysis of the legal frameworks of these jurisdictions is conducted for each of these risks, identifying where current regulations fall short in addressing these threats. Finally, the paper provides targeted proposals for each risk area, contributing to the broader goal of promoting greater global standardisation of cryptocurrency legislation.
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