Crypto regulation in US
The year 2023 has been a significant one for crypto regulation in the United States, with the country emerging as a global leader in setting standards for the crypto industry.
While the US has been busy adopting and advocating for new legislation to regulate the sector and curb illicit activities, there remains no specific law tailored for the crypto industry.
Despite this, US regulators such as the SEC, the CFTC, and FinCEN routinely provide informal guidance on the regulation of digital assets and cryptocurrencies, emphasizing the country’s focus on consumer protection and its dominant role in global finance.
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The regulatory landscape in the US is evolving, with other jurisdictions also enhancing their regulatory and enforcement frameworks for crypto.
The European Union, for example, has approved the Markets in Crypto-Assets Regulation (MiCA) and is moving towards a unified regulatory framework for cryptocurrencies.
This framework is aimed at addressing threats, particularly the potential undermining of the euro, by restricting the minting of stablecoins backed by currencies other than the euro once they reach a certain threshold.
In the US, the regulation of crypto assets is currently ambiguous, with different federal agencies having varying approaches to regulation.
The absence of a single regulator overseeing cryptocurrency or the brokers and exchanges that trade it, coupled with the divided balance of power in Washington, is likely to delay meaningful short-term reforms.
Additionally, the recent collapses of banks related to crypto assets are expected to have a chilling effect on the industry, especially concerning stablecoins3.
Looking ahead to 2024, the US is expected to continue its efforts in crypto regulation.
The Financial Services and Markets Act (FSMA), which grants regulators more power over the crypto sector, was passed into law in June 2023.
While the US has rejected wholesale crypto bans, the regulatory environment for the sector is becoming more stringent, as seen in the tightening requirements for stablecoins.
Furthermore, the SEC is anticipated to approve its first spot bitcoin ETFs, which could attract significant institutional investment into the digital assets space4.
The US has taken significant steps in 2023 to assert its position as a global leader in crypto regulation.
While the regulatory landscape is still evolving and the absence of specific legislation for the crypto industry in the US poses challenges, the country’s focus on consumer protection and its dominant role in global finance have contributed to its leading position in crypto regulation enforcement.
As we look ahead to 2024, the US is expected to continue its efforts in regulating the crypto sector, with the potential approval of spot bitcoin ETFs and the ongoing evolution of the regulatory environment for digital assets
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