The last year has been a tumultuous one for cryptocurrency and digital asset markets, with volatility and scandals contributing to trillions in losses. As such, calls for improved regulatory protections have become a lot louder.
Regulations can help balance innovation with investor and consumer protection, financial transparency, and systemic stability. Governments have begun asserting clearer authority over how crypto is issued, traded, and taxed.
For example, the U.S. recently passed the GENIUS Act and other legislation to provide more robust regulation of stablecoins and digital assets, with requirements for full reserve backing, monthly audits, and anti-money laundering compliance. Meanwhile, the EU’s unified Markets in Crypto-Assets (MiCA) regulation aims to reduce regulatory fragmentation by defining how blockchain assets are treated under relevant securities and commodities laws.
At the state level, New York has established a comprehensive set of regulations for digital assets that provides a friendly environment for market participants, while ensuring customer protection. Other states have passed or proposed more restrictive rules that treat digital assets as property for tax purposes, while also requiring money transmitter licensing and imposing Know Your Customer norms.
Federally, the CFTC retains jurisdiction over digital commodity markets, while the SEC has authority over ICOs and other offerings that qualify as securities. The pending CLARITY Act would further clarify these roles and provide greater coordination between federal agencies. Additionally, the Office of Foreign Assets Control (OFAC) continues to apply its sanctions compliance standards to transactions involving crypto.