Crypto regulation in the USA

For a long time, the U.S. crypto market has been suffering from a lack of clear, comprehensive guidelines defining how digital assets should be classified and regulated, as well as jurisdictional overlaps between regulatory bodies such as the SEC and CFTC. This regulatory ambiguity left many firms unsure about compliance requirements, resulting in inconsistent agency enforcement actions and legal challenges.

This uncertainty has lasted for several years, roughly since the rapid rise of cryptocurrencies around 2017-2018. The situation intensified over the subsequent years due to continuous conflicting statements and enforcement actions by the SEC and CFTC, often targeting similar crypto products but with differing regulatory views. This period of regulatory uncertainty began to receive bipartisan congressional focus and accelerated legislative efforts around 2024 and into 2025. The introduction and recent passage of landmark laws such as the GENIUS Act and the pending CLARITY Act mark a turning point designed to resolve this long-standing ambiguity and provide clear federal frameworks for crypto.

Before the recent successful passage of the GENIUS Act, CLARITY Act, and related legislation in 2025, several significant U.S. cryptocurrency bill proposals failed to pass. Notable among these was the RFIA (Responsible Financial Innovation Act) that was proposed in 2021 and subsequent years, aimed to create a framework for digital asset regulation, providing clarity between the SEC and CFTC and establishing investor protections. However, during multiple sessions, it failed to advance due to political disagreements, jurisdictional conflicts, and concerns over its scope and implications.

As it was said, in 2025, thanks to Donald Trump efforts, a landmark step was taken to regulate the cryptocurrency and digital asset industry through significant legislative acts: the GENIUS Act and the CLARITY Act. These laws, from now on, establish clear regulatory frameworks, clarify jurisdictional oversight, and aim to foster innovation while protecting consumers in the rapidly evolving crypto market.

CLARITY Act: Defining Regulatory Boundaries for Digital Assets

The CLARITY Act (Digital Asset Market Clarity Act of 2025) is a 236-page bill passed by the House of Representatives in July 2025 and awaits Senate consideration. Its primary objective is to end regulatory ambiguity by clearly defining categories of digital assets, such as what qualifies as a security versus a commodity. The Act includes:

• Assigning regulatory authority with clear jurisdiction between the SEC and the CFTC.

• Classifying decentralized cryptocurrencies like Bitcoin as commodities under CFTC oversight.

• Defining other digital assets clearly to bring predictability to crypto market regulation.

• Enabling a regulatory environment that fosters trust, innovation, and compliance with clearer rules for market participants.

• Allowing traditional financial institutions to engage more confidently with crypto businesses under clarified regulations.

The CLARITY Act aims to resolve the long-standing jurisdictional uncertainty that has resulted in "regulation by enforcement" and legal uncertainty, encouraging innovation and competitive growth of the digital asset industry in the U.S.

GENIUS Act: Federal Framework for Stablecoins

Signed into law by President Trump on July 18, 2025, the GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins Act) is the first comprehensive federal legislation that regulates payment stablecoins in the U.S. This act targets stablecoins that are designed to maintain a stable value relative to fiat currency, especially those used for payments and settlements. Key provisions include:

• Requiring stablecoin issuers to maintain 100% reserves in liquid, low-risk assets like cash or short-term U.S. government securities.

• Imposing strict oversight where issuers must be domiciled in the U.S. or in countries with equivalent regulatory regimes approved by the Treasury.

• Mandating monthly reserve disclosures and annual audits for stablecoin issuers exceeding $50 billion in market capitalization.

• Prohibiting issuers from offering interest or yields on stablecoin tokens.

• Granting federal approval options for issuers either through a federal charter or certified state regulators.

• Protecting token holders with priority claims on reserve assets if an issuer becomes insolvent.

• A three-year transition period for compliance for existing issuers.

This legislation legitimizes stablecoins as «payment stablecoins», allowing their integration with payment systems like ACH, VISA and Mastercard, potentially reducing settlement times and transaction costs.

Under both Acts, regulators in the U.S. are obliged to develop and issue additional rules and regulations for crypto companies. Specifically, the GENIUS Act requires federal stablecoin regulators and primary financial regulators for depository institutions to issue final regulations implementing the Act. The Act takes effect either 18 months after its enactment or 120 days after those final rules are issued, whichever is earlier. These regulations will address operational, compliance, and risk management standards for payment stablecoin issuers, including AML/CFT and sanctions compliance. The Treasury Secretary must also seek public comment on innovative AML techniques within 30 days after enactment. Thus, concrete regulatory rulemaking actions are mandated.

Similarly, the CLARITY Act directs the SEC and CFTC to engage in rulemaking that clarifies the application of securities and commodity laws to digital assets. The Act includes provisions for the SEC to modernize securities regulations around digital assets, including issuer disclosures, custody, recordkeeping, broker-dealer, and exchange registration and conduct standards. Meanwhile, the CFTC is expected to oversee cryptocurrency commodities and derivatives markets through similar regulatory rulemaking. These measures require agencies to promulgate formal, clear regulations for crypto market participants.

The GENIUS and CLARITY Acts mark a new era of regulated, transparent, and innovation-friendly crypto markets in the U.S., balancing risk mitigation with growth opportunities for the digital asset ecosystem. The combined effect of these Acts is to transform the U.S. crypto market from regulatory uncertainty to a more conventional financial regulatory environment alike the EU. This is expected to boost confidence among investors, developers, and financial institutions, accelerating crypto innovation and mainstream adoption. Companies will need to enhance their operational controls, risk management, and compliance programs to meet the new regulatory standards. This may increase short-term costs but is likely to secure long-term industry sustainability and consumer trust.