The past few years have seen crypto assets moved from being “niche products” to having more of a mainstream presence, prompting the need for more comprehensive regulation of the space, according to the International Monetary Fund (IMF).

In a new report authored by IMF capital markets director Aditya Narain and assistant director Marina Moretti, officials noted that crypto assets have firmly shifted away from being “niche products” to ones used for speculative investments, hedges against weak currencies, and payment instruments.

The authors added that this, along with  recent failures of crypto issuers, exchanges, and hedge funds have “added impetus to the push to regulate.”

The failures of crypto issuers, exchanges and hedge funds have added impetus to the push to regulate these digital assets. Read more in F&D. https://t.co/Vfyr4uN6NY pic.twitter.com/4LF9P3DZpc

— IMF (@IMFNews) September 5, 2022

However, developing regulatory frameworks for crypto assets is an uphill battle, according to Narain and Moretti, highlighting the market's rapid evolution, the difficulty of monitoring, and the absence of workable skills between regulators among the more serious obstacles, stating:

"Regulators are struggling to acquire the talent and learn the skills to keep pace given stretched resources and many other priorities."

The authors have also called out the inconsistent approach to crypto regulation amongst various regulators, instead arguing for a coordinated, consistent, and comprehensive global crypto regulatory framework.

"Some regulators may prioritize consumer protection, others safety and soundness or financial integrity. And there is a range of crypto actors — miners, validators, protocol developers — that are not easily covered by traditional financial regulation," they explained.

"A global regulatory framework will bring order to the markets, help instill consumer confidence, lay out the limits of what is permissible, and provide a safe space for useful innovation to continue."

Regulators around the world have continued to gather around the regulatory table.

In Europe, the final legal text for the long-awaited  Markets in Crypto-Assets (MiCA) regulations are set to be released within the next four to six weeks. In the United States, a crypto regulation bill named the Responsible Financial Innovation Act is set to address some of the biggest questions facing the digital assets sector.

Even staunch crypto skeptics have started to fall in line with the idea of regulation over any widespread ban, with U.S. congressman Brad Sherman becoming the latest to change his tune after admitting the market "has too much money and power behind it," to ban it now.