FinTech Global FS Regulatory Round-up - w/e 28 August 2026

Global

FSI paper: Regulating stablecoin issuance – permissible entities and activities

The Financial Stability Institute (FSI) at the Bank for International Settlements (BIS) has published a paper analysing stablecoin regulatory frameworks across the EU, Hong Kong, Singapore, the UK and the US. Key findings of the paper include:

• regulatory approaches for stablecoin issuance differ significantly, particularly in terms of the types of entities allowed to issue them and the scope of activities permitted beyond core issuance;
• stablecoin frameworks generally limit issuers to a core set of functions such as issuance, redemption and reserve management, but they differ in how far issuers may stray from them; and
• activity restrictions apply to the issuing entity rather than the group.

The views expressed in the publication are those of the authors and do not necessarily reflect the views of the BIS, its member central banks or the Basel-based standard-setting bodies. [27 Aug 2026] #Stablecoin #DigitalAsset 

UK

Government proposes new secondary objective on payments innovation for BoE

HM Treasury has announced the Government's intention to give the BoE a new secondary objective to support innovation in payment systems and emerging forms of digital money. The new objective will be subordinate to the BoE’s primary financial stability objective and will not require the BoE to support innovation where doing so would compromise financial stability.

The BoE already has a secondary innovation objective for central counterparties (CCPs) and central securities depositories (CSDs), introduced through the Financial Services and Markets Act 2023 (FSMA 2023). This reform will extend the same approach to systemic payment systems, including those using digital settlement assets. The BoE will be required to report annually to Parliament on how it has advanced the innovation objective. The Government expects to implement the change through amendments to the Financial Services and Markets Bill, which will next be debated in the House of Lords on 7 and 9 September 2026. [27 Aug 2026]  #Payments #DigitalAsset

Europe

ECB publishes papers on using AI to track investor sentiment and stress testing

The European Central Bank (ECB) has published two working papers:

• When the crowd speaks: AI-based retail investor sentiment indicator with Reddit data. The paper presents a high-frequency retail investor sentiment indicator that uses AI to convert unstructured Reddit posts into a daily measure of investor optimism and pessimism. The research suggests the indicator can help monitor retail sentiment in near real time and provide policymakers and financial stability authorities with timely insight into shifts in market mood and speculative behaviour, supporting earlier identification of emerging financial market risks.
• Learning probability of default and stress testing. The paper develops a granular machine learning framework for bank stress testing of corporate credit risk. Using Random Forests to estimate the probability of default for non-financial corporations, the authors show that the approach improves default prediction compared with logistic regression and better captures the non-linear, heterogeneous transmission of stress across the banking sector.

The views expressed in both papers are those of the authors and do not necessarily reflect those of the ECB. [25 Aug 2026] #AI

Australia

ASIC and APRA call for action against AI risks

ASIC and APRA have published a joint paper on their expectations of financial services entities to manage AI risks and build operational resilience. The paper summarises the regulators’ key insights following nine roundtables held in June and July 2026 with over 380 entities, including banks, insurers, superannuation trustees, financial advisers, the RBA, Treasury and the ACCC. The key takeaway from these discussions was that AI is increasing the speed, scale and sophistication of cyber threats to the financial system, and that the financial services industry needs to move from awareness of AI risk to action in response to it.

ASIC and APRA say that operational resilience against AI threats or disruption will be a heightened focus. The regulators say they now expect entities to take action to improve operational resilience and demonstrate that key decisions, escalation pathways, recovery arrangements and governance processes can operate efficiently and quickly should an AI threat emerge. They also expect entities to have tested the resilience of their systems before a disruption or threat occurs.

To assist financial services entities, ASIC and APRA’s paper includes a checklist of questions that boards and executives should ask themselves to ensure they are sufficiently prepared to respond to an AI threat.  [27 Aug 2026]  #AI #Cyber

Hong Kong

Financial regulators announce first cohort of GenA.I. Sandbox++

The HKMA, the SFC, the Insurance Authority, and the Mandatory Provident Fund Schemes Authority (MPFA), in collaboration with the Hong Kong Cyberport Management Company Limited (Cyberport), have announced the first cohort of the Generative Artificial Intelligence (GenA.I.) Sandbox++.  The sandbox was launched in March 2026 (see our previous update).

Participants will be onboarded to the designated platform managed by Cyberport’s Artificial Intelligence Supercomputing Centre, with technical trials commencing later in the year.

36 use cases have been selected for the first cohort – among nearly 100 proposals received – involving 30 financial institutions and 27 technology partners.  The proposals were prioritised based on innovation, technical complexity and potential value to the financial industry, as well as advice provided by a selection committee comprising academic experts.

This cohort will focus on agentic A.I. applications.  The selected use cases go beyond content generation, further exploring how A.I. can responsibly take on greater autonomy. The testing will cover end-to-end processes such as customer onboarding, payments, insurance claims, and customer interactions.  In addition, the latest pilots will further examine how A.I. can provide dynamic oversight of the actions taken by other A.I. applications, building on the ‘A.I. vs. A.I.’ theme in previous GenA.I. Sandbox cohort.  [27 Aug 2026] #AI

SFC publishes quarterly report for April to June 2026

The SFC has published its quarterly report, summarising key developments from April to June 2026.  The highlights covered by the report include (among others):

Leading financial markets transformation through technology and ESG

• Working on the legislative proposals for the new regimes covering VA dealing, custody, advisory and management services, and issuing guidance relating to stablecoins;
• Launching a framework to pilot secondary trading of tokenised SFC-authorised open-ended funds on licensed VA trading platforms; and
• Publishing the first sector-based operational guide on transition finance for the information and communications technology sector, as a co-chair of the Green and Sustainable Finance Cross Agency Steering Group. #DigitalAsset #Stablecoin #Tokenisation

Singapore

MAS: Singapore FinTech Festival 2026

The Monetary Authority of Singapore (MAS) has announced that the Singapore FinTech Festival 2026 will take place from 18 to 20 November 2026. Organised by MAS and the Global Finance & Technology Network (GFTN), in collaboration with the Association of Banks in Singapore (ABS), the Festival provides a platform for policymakers, regulators, financial institutions, technology companies, investors, and entrepreneurs to exchange ideas. This year, the Festival will examine five forces that are reshaping financial services:

• Technology – As AI transforms productivity and growth, how can financial institutions harness it while staying ahead of AI-enabled scams, cyber threats and the coming quantum challenge?
• Geoeconomics – As trade, investment and capital flows shift and new economic corridors emerge, how are financial networks adapting in response, and how can these networks be built to support trade and economic resilience?
• Capital – Can productivity gains and revenue growth sustain an investment boom that has already driven AI-connected firms to around 40% of S&P 500 market capitalisation?
• Talent – As AI transforms jobs, how can financial institutions enhance skills and capabilities of their workforce to stay competitive?
• Policy – How can policy, governance and risk frameworks keep up as technology races ahead, to enable innovation without compromising trust and resilience?

The Festival will be preceded by the Insights2040 Annual Meeting, formerly known as the Insights Forum, held from 16 to 17 November.  [26 Aug 2026] #AI #Cyber

Thailand

SECT consults on regulations for crypto ETFs and enhanced qualifications for foreign digital asset custodians engaged by funds

The Securities and Exchange Commission Thailand (SECT) has announced it is seeking comments on:

• draft regulations governing the establishment and regulatory framework for crypto ETFs in Thailand; and
• proposed principles for revising the qualification requirements for foreign digital asset custodians engaged by mutual funds and private funds investing in digital assets.

The proposals aim to broaden investment opportunities for investors, enhance the capabilities of business operators, promote product diversity in Thailand’s capital market, and establish consistent standards for the offshore custody of digital assets across relevant fund types.

Feedback is requested by 20 September 2026.  [24 Aug 2026] #DigitalAsset #Crypto #ETF

India

SEBI launches Cyber Suraksha Portal, confirms alignment with FIRE format, sets out IT resilience index for market infrastructure

SEBI has launched the Cyber Suraksha Portal as part of its Cyber Security Initiative. This platform provides a comprehensive, centralised hub for the securities market to share crucial knowledge and disseminate information regarding cyber security. Through this portal, market participants can directly access the latest cybersecurity circulars, vulnerability warnings and incident insights.

SEBI has also published a circular announcing that, in order to streamline the reporting of cyber incidents, it has aligned its Incident Reporting Portal with Format for Incident Reporting Exchange (FIRE) Framework developed by Financial Stability Board (FSB). As the circular explains, regulated entities are required to take steps to implement this change. 

The regulator has also published a circular addressed to market infrastructures which sets out the framework covering oversight of resilience of IT systems, the early identification of emerging weaknesses and the application of corrective measures. Infrastructures are required to take steps to implement the framework. There are compliance deadlines for different aspects of the framework; these are all in Q1 of 2027.  [24 Aug 2026] #Cybersecurity

Philippines

BSP Governor and  Asia Pacific counterparts agree to strengthen cooperation on current issues facing region’s financial systems

The BSP has announced that its Governor, Eli M Remolona, Jr, and his counterparts from Asia Pacific agreed to strengthen cooperation on current issues facing the region’s financial systems. During the July Executives’ Meeting of East Asia Pacific Central Banks (EMEAP), central bank governors approved initiatives meant to intensify consumer protection in the region and help its financial industries better deal with AI.

In the 15th Informal Meeting of the EMEAP Governors and Heads of Supervisory Authorities, Governor Remolona and his counterparts shared best practices and insights on responsible AI adoption and use by financial institutions. The participants recognized the importance of responsible AI use in safeguarding financial consumers and allowing financial institutions to effectively manage risks while leveraging opportunities from AI.  [20 Aug 2026] #AI

US

FINRA issues cybersecurity alert warning member firms of active data extortion campaign

FINRA has issued a cybersecurity alert warning member firms of a significant and ongoing data extortion campaign conducted by a threat actor group which has been targeting organisations across multiple sectors, including financial services.

FINRA confirms that this alert does not create new legal or regulatory requirements but strongly recommends firms take immediate remedial action.  [Aug 25, 2026]  #Cybersecurity

Treasury launches Quantum-Readiness Task Force to drive financial sector's post-quantum cryptography transition

The US Department of the Treasury has announced the launch of the Quantum-Readiness Task Force, a public-private initiative designed to help the US financial sector transition to quantum-safe cryptographic technology in an orderly and operationally resilient manner. The establishment of the Task Force follows Executive Order 14412, signed by President Trump, which establishes guidelines to strengthen cryptographic protections for the U.S.'s sensitive data, critical infrastructure, and digital economy.

The Task Force will operate through three workstreams: Sector Alignment and Post-Quantum Cryptography Transition; Third-Party and Vendor Readiness; and Digital Assets and Emerging Technology Risk. It will bring together government, financial institutions, financial market infrastructures (FMIs), technology providers, and other private-sector leaders to support coordinated preparation for quantum-related cyber risks, focusing on practical, risk-based approaches including identifying critical dependencies, improving cryptographic agility, promoting interoperability, and strengthening operational resilience. The initiative builds on the G7 Cyber Expert Group's roadmap for the transition to post-quantum cryptography.  [Aug 24, 2026]  #Quantum #DigitalAsset #Crypto