Cryptocurrency regulation consists of the rules and laws that determine how digital assets are issued, traded, stored, and integrated into financial systems. These rules vary by country and continue to evolve as lawmakers respond to technological advances and market risks. Some have created comprehensive frameworks that cover numerous crypto-related activities, while others impose partial rules or outright bans. Regulation can span many aspects of digital assets, including payment systems, securities offerings, taxation, and anti-money laundering compliance.
In the United States, the GENIUS Act reflects a move toward more comprehensive federal regulations for stablecoins and digital asset markets. It requires that issuers of payments stablecoins maintain full reserve backing, monthly audits, and anti-money laundering compliance standards. It also establishes disclosure rules and consumer protection standards intended to increase market trust. In addition, it greenlights CFTC and SEC enforcement of financial stability and consumer protection laws against market participants that engage in misconduct.
In contrast, China has been cracking down on cryptocurrency exchanges and initial coin offerings in a bid to curb the spread of its own CBDC, the digital yuan. This approach has drawn criticism from privacy advocates and finance companies, but the Chinese government is largely committed to building a robust regulatory framework for blockchain technology.