Italy Launches In-Depth Crypto Risk Review as European Regulation Enters a New Phase

Source: PortaldoBitcoin Original Title: Italy launches “in-depth” review of cryptocurrency risks Original Link: Italy launches “in-depth analysis” of cryptocurrency risks

As digital assets gain traction in traditional markets and fragmented rules make regulation complex, Italy has launched an “in-depth analysis” of retail investors’ exposure to cryptocurrencies.

The Macroprudential Policy Committee, composed of the Bank of Italy governor, insurance and pension regulators, and the finance ministry, warned on Thursday, (4th), that risks could increase due to “growing interconnections with the financial system and fragmentation of regulation at the international level.”

The Ministry of Economy and Finance has launched the review to assess protections for retail investors making direct and indirect investments in cryptocurrencies, according to an official statement.

The review points to growing European concerns that fragmented global rules are creating regulatory blind spots, especially as the US adopts more crypto-friendly policies and the digital asset market surpasses $3 trillion, according to CoinGecko data.

“Fragmented regulation of cryptocurrencies creates real risks,” said Ruchir Gupta, co-founder of Gyld Finance. “It pushes riskier activities into poorly regulated jurisdictions and obscures where the true financial exposures lie.”

Gupta expects “significant convergence by 2026” as the US clarifies its regulatory path, providing a benchmark and economic pressure for other countries to align.

“Italy’s review shows regulators are now examining crypto’s impact on financial stability, rather than treating it as a fringe issue,” he added.

Active regulatory phase

The committee’s announcement follows an April warning from the Bank of Italy that highlighted the growing global integration of cryptocurrencies as a potential threat to financial stability.

The report cited the sharp price rise following Trump’s election win and his administration’s pro-crypto stance, warning that if digital tools “become more tightly interwoven with the traditional financial system, markets and intermediaries could face greater vulnerabilities.”

The bank also warned of conflicts of interest and governance gaps, noting that about 75% of companies holding significant Bitcoin positions are based in the US, with “almost no presence” in the euro area.

Europe is “entering a more active regulatory phase for fintech and cryptocurrencies,” and Italy’s in-depth analysis is a “key upgrade,” coinciding with the full implementation of the crypto asset markets regulation (MiCA), said Nitesh Mishra, ChaiDEX hedging platform co-founder and CTO.

The EU’s regulatory push includes “stricter licensing and capital rules,” as well as tougher guidance on anti-money laundering (AML), Mishra said, calling it “an important step” as the US still lacks a clear framework and many offshore jurisdictions offer “minimal regulation” licenses, creating global protection gaps.

For crypto providers in the region, compliance costs will rise with demands for robust governance, disclosures, and investor protection, but in return, companies will gain “regulatory certainty, ease of operating in the EU, and a competitive edge over companies based in more permissive jurisdictions.”

“Serious participants may prioritize Europe as the gold standard, moving away from risky tax havens and serving retail users more securely,” Mishra added.