For over a decade, the U.S. cryptocurrency industry has existed in a peculiar state.
The market size has grown to the trillions of dollars, but a comprehensive regulatory framework has yet to be established. The two most critical questions remain unanswered:
- What exactly are crypto assets?
- If issues arise, who will oversee them?
These two issues may seem simple, but they are the root cause of the long-standing confusion in U.S. cryptocurrency regulation.
Over the past few months, the U.S. regulatory framework has begun sending a series of new signals—these two issues are being reconsidered.
Regulatory uncertainty
In the U.S. financial regulatory system, crypto assets have consistently fallen between the jurisdictions of two agencies: the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). The SEC oversees securities markets, while the CFTC regulates commodities and derivatives trading.
The issue is that crypto assets possess two characteristics simultaneously. Some tokens have financing attributes and resemble securities, while others are more like digital goods or network resources.
Therefore, for many years, the U.S. crypto industry has faced a core uncertainty: the same asset may be interpreted under two conflicting regulatory frameworks. This situation has been referred to by many industry professionals as “regulatory fog.”
Companies often struggle to determine which set of regulations a particular product must comply with. In some cases, companies may need to navigate regulations from two regulatory bodies simultaneously.
The impact of this regulatory conflict extends beyond legal disputes—it directly influences business decisions. SEC Chairman Paul Atkins acknowledged in a public speech that regulatory conflicts, overlapping registration requirements, and differing regulatory frameworks have, to some extent, stifled innovation and pushed certain market participants toward other jurisdictions.
In other words, internal divisions within the U.S. regulatory system are themselves undermining its appeal to the cryptocurrency industry.
How are crypto assets classified?
For a long time, U.S. federal securities laws did not recognize the concept of "crypto assets."
Regulators typically use the Howey Test to determine whether an asset qualifies as a security. This test assesses whether a transaction constitutes an investment contract. In simple terms, if an investor puts money into an arrangement with the expectation of profit primarily from the efforts of others, that arrangement may be classified as a security.
For decades, this standard has been a foundational element of U.S. securities regulation. However, applying this logic to crypto assets introduces complexities.
Some tokens clearly have investment characteristics. Others function more like network access credentials. And some are simply digital collectibles.
In the same market, assets can have completely different characteristics.
In response to this complexity, the SEC proposed a new regulatory framework in November 2025. SEC Chair Paul Atkins stated that the SEC is establishing a four-category token classification framework based on the Howey Test. This framework categorizes digital assets into four types:
- Digital goods or network tokens
- Digital collectibles
- Digital tools
- Tokenized securities
This classification framework also marks the first time U.S. regulators have systematically acknowledged that not all crypto assets are securities.
Who regulates?
But even as asset types begin to become clearer, another issue remains.
If certain tokens are classified as digital commodities, which regulatory authority has jurisdiction?
In the U.S. financial system, the primary regulatory body for commodity markets is the CFTC. This means that once certain digital assets are classified as commodities, regulatory authority is no longer solely under the SEC.
This is precisely the long-standing institutional conflict between the SEC and the CFTC over the past several years.
The mist is gradually clearing
Recently, there have been signs of easing in this long-standing regulatory divide.
The SEC and CFTC announced the signing of a Memorandum of Understanding (MOU), committing to enhanced coordination across multiple areas, including:
- Cryptocurrency regulation
- New digital asset product
- Investor protection
- Federal-level policy framework
Although the MOU itself is not legally binding, it sends a clear signal that U.S. regulators are beginning to address long-standing jurisdictional conflicts.
Both parties also proposed a key objective: establishing an "adaptive regulatory framework."
This means the U.S. may no longer simply apply traditional financial regulations directly to digital assets, but instead seek to develop more suitable frameworks for this emerging market.
Behind this change lies a broader context.
Over the past few years, major financial centers worldwide have been accelerating the development of regulatory frameworks for digital assets. Some regions have already implemented unified regulatory frameworks, while others have attracted crypto businesses by establishing clear rules.
In contrast, although the United States has the largest cryptocurrency market, its regulatory framework has long been fragmented. An increasing number of companies are choosing to operate in jurisdictions with clearer regulations—a trend that is clearly unfavorable for the United States.
Meanwhile, the structure of the crypto market is also changing.
The early crypto industry primarily revolved around native crypto assets, while the two fastest-growing areas today are stablecoins and RWA. USD stablecoins are typically backed by reserves such as U.S. Treasury securities; RWA directly tokenizes traditional financial assets.
This means that crypto finance is gradually becoming integrated into the traditional financial system. As the two begin to converge, regulatory frameworks must also adapt accordingly.
New regulatory framework
When viewed together, this series of changes suggests that the U.S. regulatory system is undergoing a structural reorganization.
- The first step is to clearly define the basic categories of digital assets.
- The second step is to coordinate the boundaries of authority among different regulatory agencies.
- The third step could be establishing unified federal-level regulations for the digital asset market.
If this process is ultimately completed, the United States will establish a comprehensive regulatory framework for digital assets.
From a broader perspective, this regulatory restructuring concerns not only the cryptocurrency industry itself but also the right to set the rules for the future financial system.
With the growth of stablecoins, tokenized assets, and on-chain finance, digital assets are gradually becoming the new financial infrastructure.
Regulators around the world are all trying to answer the same question: Who sets the rules in the era of digital finance?
The current regulatory adjustments in the United States are part of this competition.
As the rules become clearer, the crypto industry may enter a new phase after years of regulatory uncertainty.
The content of this article is for reference only and does not constitute any investment advice. The market carries risks; invest with caution.