Evaluating crypto regulation stringency and its impact on digital asset market adoption

Type of the article: Research ArticleAbstractThe article provides a comprehensive empirical assessment of the legal and operational regimes of digital asset circulation and their real impact on the financial market. To quantitatively measure the degree of state control, a composite Crypto Regulation Stringency Index (CRSI) was applied, constructed based on the OECD-JRC methodology. The index integrates 16 parameters across five fundamental areas (legal status, anti-money laundering, taxation, licensing, and consumer protection) for 61 countries (jurisdictions) as of 2025. The developed tool demonstrated high internal consistency and factor structure reliability (Cronbach’s α = 0.955).To determine the market consequences of legal regulation, the index values were compared with the Chainalysis 2025 Global Crypto Adoption Index. The direct unconditional correlation between the stringency of rules and the scale of digital asset usage proved to be weak. However, a multivariate regression analysis conditional on a set of macroeconomic and institutional covariates (income level, digital infrastructure development, financial freedom, quality of the rule of law, and the specifics of the MiCA regulation) revealed a robust and statistically significant positive relationship. The reversal of the effect is consistent with a Simpson-type compositional effect: within groups of countries with comparable levels of economic development, clear and strict regulatory rules stimulate market activity. The findings extend the literature on comparative financial law and demonstrate that state control does not suppress the crypto-economy but rather serves as its stable institutional foundation.