Cryptocurrency regulation: U.S. and international policy guide
Jan 20, 2026・5 min read
Cryptocurrency began life on the fringes of finance, but is now a globally-recognized asset category, with a total market cap in the trillions. In the same period, crypto regulatory policy has grown nearly as fast, playing its own role in encouraging Web3 adoption.
At both national and international levels, governments and major organizations are passing laws that more clearly define what crypto is from a legal standpoint and how it should be regulated. Crypto holders and traders need to be aware of policies like the Financial Innovation and Technology for the 21st Century Act (FIT21 Act) and the Financial Action Task Force (FATF) standards.
Staying up to date on cryptocurrency regulation helps you understand your responsibilities and remain compliant. This guide covers important policies for 2026 and explores some of the questions that still don’t have clear answers.
How cryptocurrency is regulated in the United States
Crypto regulation has evolved unevenly in the U.S., and there’s no clear system for producing policy or single entity in charge of digital assets. However, there’s growing consensus about which federal agency has control over cryptocurrency in different contexts, thanks to newer policies like the FIT21 Act and roles such as the “White House AI & Crypto Czar. ”
Here are the key players for U.S. crypto regulation in 2026, and their current areas of responsibility.
Congress
Congress doesn’t enforce crypto policy, but it creates the legal frameworks other agencies use to guide their regulatory actions. One recent example is the FIT21 Act, which passed the House of Representatives in May 2024.
Despite stalling in the Senate for the rest of the year, the updated Digital Asset Market Clarity Act of 2025 passed the House again in July. To date, this act (still commonly known as FIT21) hasn’t become law, but its proposals for cryptocurrency definitions and oversight already serve as guideposts for other agencies.
Also in 2025, Congress passed the Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act), which became law in July. Unlike FIT21, the GENIUS Act focuses on stablecoins, and it effectively legitimizes them as a form of payment – provided they meet specific listing guidelines for compliance and security.
Securities and Exchange Commission (SEC)
If a cryptocurrency has traits that align with a traditional security, like shares in a company, the SEC requires registration and disclosure. Traditionally, the SEC determines whether an asset is a security based on the Howey test’s four criteria:
- An investor uses money to purchase the asset
- The investor’s success depends on a common enterprise rather than individual effort
- Buyers expect to profit
- Profits from the investment depend on the third party’s actions
In past administrations, the SEC’s crypto regulation focused on enforcement, sometimes sending Wells notices to centralized exchanges (CEXs). But with the creation of the Crypto Task Force, the SEC now puts greater emphasis on coordinating with lawmakers and other regulatory bodies.
Commodity Futures Trading Commission (CFTC)
The CFTC’s traditional role is protecting investors that hold derivatives contracts on commodities (e.g., corn, oil, or wheat) in markets such as the Chicago Mercantile Exchange. But the two largest digital assets – Bitcoin (BTC) and Ethereum (ETH) – now have official commodity status, which puts them under the CFTC’s jurisdiction.
Although lawmakers have yet to codify the extent of this agency’s powers, the CFTC and SEC are working together through the Project Crypto-Crypto Sprint to promote greater clarity.
Financial Crimes Enforcement Network (FinCEN), IRS, and other agencies
Other federal agencies that impact crypto regulation include:
- FinCEN: FinCEN enforces anti-money laundering and countering the financing of terrorism laws in the Bank Secrecy Act. Any crypto exchanges FinCEN classifies as money services businesses (MSBs) need to enforce policies like know your customer, so they can monitor transactions and file suspicious activity.
- IRS: The IRS views cryptocurrencies as property, making these assets subject to capital gains or losses after disposal or income generation from activities like staking, crypto mining, and yield farming. American-based CEXs must also submit IRS 1099-DA crypto forms with yearly disposal activity for qualifying crypto.
- Office of the Comptroller of the Currency (OCC): The OCC is most concerned with how cryptocurrencies fit into traditional banking law and how institutions like national banks should legally deal with digital assets. In the OCC’s most recent publications, including interpretive letters 1183 and 1186, this agency opened the door for financial institutions to invest in and use digital assets.
2025
Crypto Tax
Guide is here
CoinTracker's definitive guide to Bitcoin & crypto taxes provides everything you need to know to file your 2024 crypto taxes accurately.
How other countries handle crypto regulation
Although U.S. crypto laws are widely influential, other countries have their own crypto laws that affect how global investors trade and track crypto.
European Union
In 2023, the EU Parliament adopted the Markets in Crypto-Assets Regulation (MiCA), a comprehensive framework for digital assets. This MiCA regulation allows EU citizens to use and conduct business with crypto, but requires that firms meet high transparency standards and hold licenses from the European Banking Authority and local agencies.
United Kingdom
With the 2025 approval of crypto asset regulations for the Financial Services and Markets Act, the UK is on track to bring crypto under the same regulatory standards as traditional financial products by 2027. Instead of creating a bespoke regulatory framework, the UK plans to incorporate crypto into existing laws from institutions such as the Financial Conduct Authority, deliberately following the U.S. model.
Canada
Canada doesn’t have a legal framework specific to cryptocurrencies, but it allows MSBs to offer digital assets as long as they comply with Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) policies.
Some provinces like Ontario have more nuanced requirements. Also, the recently proposed Bill C‑15 is the first federal policy specifically aimed at stablecoins, and would require formal registration with the Bank of Canada.
China
Since its 2021 ban on all crypto activities, China maintains a strong stance against digital assets. The only blockchain-related activity Chinese authorities support is the state-sponsored Central Bank Digital Currency known as e-CNY – otherwise, residents and businesses cannot transact using crypto.
Ongoing challenges in cryptocurrency regulation
Despite the growing list of crypto policies, many questions remain unanswered. Lawmakers must contend with these challenges as they continue to address this new asset category.
Classification issues
Many policies must first determine whether a digital asset is a commodity, currency, or security, as this classification impacts how the asset is governed. In past cases like SEC vs. Ripple Labs, the SEC argued that many cryptocurrencies are unregistered securities that need regulatory approval.
However, the U.S. District Court for the Southern District of New York found that Ripple’s XRP Ledger (XRP) token only fit the definition of a security in specific circumstances (when given to insider investors and supporters). Although this ruling sets a precedent for the debate over crypto’s security versus commodity status, it also shows how context often determines digital asset designation.
Overregulation concerns
Complaints from crypto advocates in the U.S. often focus on the SEC’s policy of “regulation through enforcement” and perceived overreach of authority. One flashpoint for this critique was the SEC’s 2023 charge against the CEX Coinbase for allegedly operating an unregistered securities exchange.
Although the SEC formally dismissed its civil enforcement action against Coinbase in 2025, the crypto community remains wary of overregulation that could stifle innovation and liberty in the name of consumer protection.
Global coordination difficulties
Some international bodies, like the FATF, have proposals and policies for crypto. But there are no guidelines for encouraging every country to adopt the same global crypto laws.
For example, the FATF’s travel rule requires virtual asset service providers to share sender and receiver data for transfers. However, since each country has different policies on crypto transactions, collecting and storing this data poses huge logistical challenges, along with concerns over invasion of privacy.
Stay aligned with U.S. cryptocurrency regulation
U.S. crypto tax regulations are still in flux, so transparent transaction reports are essential if you want to stay up to date and compliant. The IRS expects detailed records of every crypto transaction, whether on centralized or decentralized exchanges.
CoinTracker makes this task easier by linking to all your crypto exchange APIs and wallet addresses. The Portfolio Tracker gives you a comprehensive view of all of your crypto activity, and you can easily import data into IRS crypto tax forms.
Worried about reporting your crypto taxes? CoinTracker makes it simple. Join over three million users who trust us for hassle-free tax reporting. Start for free today.
Disclaimer: This post is informational only and is not intended as tax advice. For tax advice, please consult a tax professional.