Southeast Asia is rapidly becoming a regional hub for innovation in virtual digital assets (VDA), spurred by a combination of proactive regulation, increased institutional interest, and high rates of technology adoption. Each country is carving out its own niche which adds both momentum and complexity to the growth of the sector, from Singapore’s grappling with institutional-grade crypto infrastructure, to the Philippines’ active retail market.
Singapore continues to lead the region with digital asset innovation as the Monetary Authority of Singapore (MAS) embraces a progressive approach to encourage the growth of crypto in Singapore. An important development is the Singapore Exchange’s (SGX) plan to list bitcoin perpetual futures in the second half of 2025 targeting institutional investors, a clear signal that Singapore is committed to creating robust, high-integrity infrastructure for the intermediation of traditional financing with emerging digital markets.
At the same time, Thailand is looking to tighten up their regulations, with the Securities and Exchange Commission (SEC) obliging exchanges to hold customer assets only in secure, auditable cold wallets to increase investor protection. And while Thailand is still tightening regulations, it has permitted tourists to pay with Bitcoin, which is part of an overarching strategy to establish itself as a global digital economy. On the tax front, Thailand has also eased taxation for cryptocurrencies for 5 years for trades from licensed exchanges, thereby incentivizing compliance.
Vietnam is moving towards compliance with crypto assets comprehensive legal framework with proposed regulations on ownership arrangements, money laundering, taxation, and licensing in place by May 2025. While crypto remains banned as legal consideration for payments, these regulations demonstrate a clear shift towards formal recognition and some regulated oversight of crypto assets. At the same time, Indonesia is also moving towards updated regulatory checks and balances with OJK Regulation 3/2024 (effective January 2025), which provides a structured approach for financial institutions to report, including new technologies such as crypto. It aims to move towards responsible innovation and risk management as well as enabling growth.
The Philippines has arguably one of the most dynamic and perhaps exciting crypto markets in the region. For example, Coins.ph processes over two million transactions per day and has over 18 million users. In the Philippines, the vast majority of crypto adoption is being fuelled by the younger demographic and the large remittance sector. With this in mind, the Philippines is a great example of why digital finance is in demand; it meets a practical need yet also enables financial inclusion.
The rise of institutional participation is also growing. FalconX, a leading crypto prime broker, has announced a partnership with Standard Chartered that will enable institutional crypto services in Singapore and later in Asia. The partnership highlights the significant need for regulated access to crypto in a traditional financial world.
Yet, there are challenges, especially in light of the severe scrutiny that the region is under regarding illicit crypto activity. Recently, the U.S. Financial Crimes Enforcement Network (FinCEN) flagged the Cambodia-based Huione Group for laundering $4 billion in various crypto transactions. Events like this show that there is an urgency for more robust anti-money laundering and regulatory cooperation for cross-border transactions in the region.
Also read: Why India needs Crypto Custody Solutions: growing risks for Indian Investors
With risks in mind, Southeast Asia is continuing to find an equilibrium with innovation. All of the countries in the region are helping to establish a set of rules that will help build a secure and inclusive future for digital finance that recognizes and supports new technology while establishing strong governance.
Conversely, India’s position on VDAs is still mainly reactive. On the other hand, Southeast Asian counterparts are moving ahead with clear rules and being proactive with their engagement, allowing for a wider regulatory landscape, while India is still mired in draft proposals and fragmented views amongst different departments. Without a cohesive regulatory framework, India lags the quickly defining next phase of financial services at its own pernicious expense.
The Indian government must take a more proactive stance to avoid losing ground. A first and foremost step would be to develop an inter-ministerial committee in order to provide cohesive policy direction. Realising tax parity between crypto and fiat transactions is also necessary to equalise the playing field and remove disincentives. More broadly, India must generate clarity in its long-term commitment to being a responsible facilitator of the sector through overlapping regulations, clarity on investor protections, and demonstration of support for responsible innovation.
As other nations ramp up their frameworks, India’s long overdue engagement with the crypto and VDA landscape can no longer be optional, it is urgent.
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