Author of the opinion: Dipendra Jain, Co-founder of TCX

Regulation has become the baseline for cryptocurrency. From regulatory enforcement in the U.S. to comprehensive cryptocurrency rulebooks in Dubai, to renewed debates in India about formalizing Bitcoin reserves, governments around the world are rewriting the rules of digital finance. As listed institutions, retailers, and social networks weigh the tracks of digital assets, stablecoins, and yield mechanisms, the real story is no longer what the next step is, but who is building the next step.

Speculation once drove adoption, but structured compliance has catalyzed the scaling of the Asia-Middle East corridor. Centers like the UAE and India view regulation as a pillar of innovation. The UAE is pushing for a unified Virtual Asset Service Provider (VASP) framework to accelerate global cryptocurrency ambitions. Meanwhile, India is opening the door for the return of offshore cryptocurrency exchanges, approving reviews now required by the Financial Intelligence Unit (FIU).

As regulatory frameworks are formalized, platforms must align with new tax, data governance, and licensing rules to enter the expanding market seamlessly. The global focus is shifting eastward, and the question is: who will master the "permissioned scale" era, where sustainable growth comes from thriving within regulation rather than evading it?

Understanding jurisdictional rules was once sufficient to enter the market, but it is no longer enough. The Dubai Virtual Assets Regulatory Authority (VARA) has issued 36 full licenses, supporting over 400 registered companies. VARA is also piloting tokenized gold and DeFi products, which promise to experiment with real-world assets beyond established solutions in a controlled environment, reflecting a growing enthusiasm.

However, if platforms cannot meet user needs, mere regulation will render them powerless. India has over 1.12 billion mobile connections, with 55.3% of the population online, yet only 27% of adults meet basic financial literacy requirements. Platforms must recognize the necessity of bridging the knowledge gap through user journeys embedded with education. In remittance-heavy Cambodia and the Philippines, where such transactions account for 9% of GDP, cryptocurrency platforms can provide more efficient blockchain-based fintech solutions by leveraging stablecoins to simplify transfers, reduce costs, and enhance transparency.

Without contextualized features and user-oriented solutions, financial sovereignty will remain idealized for underbanked populations and emerging markets. Platforms that embed jurisdictional intelligence at their core and localize products through compliance and cultural relevance will set the standard for future adoption. This ultimately distinguishes short-term participation from long-term leadership.

The industry is at a critical moment where compliance has become the ultimate competitive moat. Low-cost, government-supported payment tracks are replacing traditional payment processes, challenging global card networks like Mastercard and Visa. Today, regulated fiat-cryptocurrency integration has similar potential to replace traditional infrastructure, which can only be unlocked by those actively building trusted access within regulatory parameters.

When there is regulatory clarity, progress and adoption will follow. The UAE attracted $34 billion in cryptocurrency inflows last year in the Middle East. India's Unified Payments Interface (UPI) is another example of how regulation can enhance fraud metrics while protecting user funds. Cross-border collective efforts can encourage cryptocurrency platforms to integrate automated compliance and risk monitoring at the protocol level.

A regulated foundation also makes cross-border capital flows more feasible. This enables them to meet institutional demands for transparent, scalable, diversified liquidity and access to global capital markets. Permissioned scale is underway, with regulatory, payment, and liquidity infrastructures expanding in sync. The development of stablecoins further complements this infrastructure, providing a robust programmable medium for cross-border settlements connecting traditional finance and the cryptocurrency ecosystem.

AI introduces three indispensable elements: real-time regulatory interpretation, fraud detection, and parity-based transactions. Platforms can address jurisdictional requirements by directly injecting regulatory intelligence into transaction mechanisms while optimizing user experience.

Real-world assets (RWA) further expand this opportunity. Tokenized commodities like real estate, sovereign bonds, and gold are gaining attention, expected to grow into a $10 trillion market by 2030, particularly in economies seeking diversified pools of wealth and investment options. In ESG areas such as agriculture, carbon credits, and trade receivables, tokenization eliminates friction, reduces reliance on intermediaries, and accelerates settlement timelines. It creates liquidity for underserved participants, including small and medium-sized enterprises (SMEs), while providing institutional investors with new, risk-adjusted diversified returns.

Partnerships between capital markets and cryptocurrency companies also lay the groundwork for tokenized private equity and other frontier assets. While still considered largely uncharted territory, clarity is expected to catch up as giants like BlackRock, eToro, Robinhood, and Coinbase call for RWA representation in mainstream portfolios.

An AI-native approach capable of pricing, routing, and settling RWA transactions must integrate compliance throughout the stack, from onboarding and identity verification to transaction monitoring and regulatory reporting. This compliant, AI-driven core will become a decisive innovation in the next generation of financial infrastructure.

The returns from speculative surges have faded. Today's growth comes from platforms designed to scale by the rules. When regulation is a given, true differentiation lies with those who will establish lasting trust, liquidity, and utility across jurisdictions.

Leadership in this emerging reality will come from platforms that are well-versed in regulatory details, based on user behavior, and equipped with technology to unlock compliant access to global capital and real-world assets. As the Asia-Middle East corridor sets the pace, platforms mastering permissioned scale will write the next chapter of cryptocurrency.

Author of the opinion: Dipendra Jain, Co-founder of TCX.

Related: Bitcoin (BTC) climbs to 1.7% of global currency share ahead of Fed Chair hinting at rate cuts

This article is for general informational purposes only and should not be construed as legal or investment advice. The views, thoughts, and opinions expressed here are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Original article: Opinion: The Future of Cryptocurrency in the Asia-Middle East Corridor Lies in Permissioned Scale

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