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G20 Crypto Agreement Strikes a Balance Between Fostering Innovation and Managing Worldwide Risks

G20 Crypto Agreement Strikes a Balance Between Fostering Innovation and Managing Worldwide Risks

Bitget-RWA2025/11/23 04:50
By:Bitget-RWA

- G20 leaders agreed to harmonize global crypto regulation, prioritizing stablecoin and DeFi standards to balance innovation with systemic risk mitigation. - The declaration includes a Critical Minerals Framework to ensure sustainable resource-driven growth in Global South nations while securing crypto infrastructure supply chains. - Market shifts show USDC overtaking USDT in on-chain activity due to regulatory clarity, while DeFi faces $12B liquidity stagnation from fragmented protocols. - Regulatory scru

G20 Leaders Announce Unified Approach to Crypto Regulation, Setting Standards for Stablecoins and DeFi

The 2025 G20 summit wrapped up with a significant declaration focused on creating consistent international regulations for cryptocurrencies. The statement highlights the need for unified rules for stablecoins and decentralized finance (DeFi), aiming to manage systemic risks while encouraging technological progress. The agreement,

, reflects a shared commitment to balancing industry expansion with safeguarding investors and maintaining financial security.

An important element of the declaration is the launch of the G20 Critical Minerals Framework,

that countries rich in minerals, especially those in the Global South, gain from economic development driven by their resources while following sustainable guidelines. This framework supports broader objectives to reinforce supply chains for technologies dependent on critical minerals, an area increasingly connected to crypto infrastructure.

These regulatory efforts are already influencing the market landscape.

Circle’s has overtaken Tether’s in on-chain transactions, a shift attributed to clearer regulations and greater institutional involvement. USDC’s market value has soared 72% so far this year to $74 billion, outpacing USDT’s 32% rise, as investors increasingly prefer stablecoins that comply with MiCA regulations. This trend highlights a rising demand for transparency, especially in Europe, where USDT’s lack of regulatory approval has led to its removal from several trading platforms.

G20 Crypto Agreement Strikes a Balance Between Fostering Innovation and Managing Worldwide Risks image 0

Meanwhile, DeFi continues to grapple with liquidity issues.

that $12 billion in DeFi liquidity is currently inactive, with 95% of funds not being used efficiently due to fragmented platforms and suboptimal trading routes. Solutions like 1inch’s Aqua protocol are being developed to tackle this “liquidity crunch” by allowing capital to be shared across strategies without giving up user control. Co-founder Segej Kunz stressed the importance of reducing entry barriers, (DEXs) with minimal coding effort.

Leverage in the market has also reached unprecedented heights,

$73.6 billion in crypto-backed borrowing in the third quarter of 2025. DeFi lending alone accounted for $41 billion, fueled by incentives and improved collateral options such as Principal Tokens. Centralized lending platforms, though smaller in scale, experienced a 37% increase in outstanding loans, with holding nearly 60% of the tracked CeFi lending market.

Regulatory attention has intensified as U.S. senators get ready to question Michael Selig, Donald Trump’s pick for CFTC chair,

. This proposed legislation aims to classify cryptocurrencies as commodities, thereby broadening the CFTC’s oversight of spot markets. Selig, who previously led the SEC’s crypto task force, to advancing the U.S. as a global crypto leader while managing regulatory overlaps with the SEC.

Security remains a top concern.

disclosed a $25 million asset seizure tied to a crypto-based drug trafficking operation that transferred money to Russian organizations. Despite the transparency of blockchain, authorities emphasized the need for better tools to track illegal transactions. In a similar vein, users to avoid its main website following a “front-end” breach, highlighting ongoing security risks within DeFi systems.

The G20’s declaration marks a turning point for international crypto regulation, striving to balance technological advancement with effective risk management. As new rules take shape and industry players adjust, the future of the sector will depend on cooperation among regulators, developers, and major institutions.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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