Picture a crypto business that, within two years of launch, is serving customers in the UAE, the UK, the EU and Singapore. Its product, team and revenue all expand in step. Yet the compliance function meant to support that growth rarely keeps pace, and that mismatch is quietly becoming one of the sector’s biggest risks.

According to Sherlocq, the issue is seldom a lack of willingness. Founders accept that compliance matters, and legal teams are aware of the relevant frameworks. However, awareness of the rules is very different from running a live regulatory research operation across multiple jurisdictions. It is in that gap that firms tend to come unstuck.

On paper, the process looks simple: track regulatory change in every market, link new obligations to internal processes, revise policies, train staff and keep records ready for audit. In reality, many firms rely on a fragmented set of workarounds. A general counsel may skim regulator newsletters, a compliance officer may manually check the Financial Conduct Authority (FCA) website, and a consultant brought in to secure a Virtual Assets Regulatory Authority (VARA) licence in the UAE may disappear once approval is granted. The result is research that is reactive, patchy and stretched thin against the sheer volume of change.

Each regime also moves at its own rhythm. VARA’s framework develops on a different timeline from the EU’s Markets in Crypto-Assets (MiCA) regulation, while the Monetary Authority of Singapore’s (MAS) licensing requirements bear little resemblance to the FCA’s Travel Rule guidance. Attempting to juggle all four without a proper system is effectively an unrealised liability.

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