United States

Securities regulation (SEC). The Securities and Exchange Commission has taken the position that most crypto tokens — outside of Bitcoin and (in a narrow, evolving sense) Ethereum — are or may be securities under the Howey test. SEC enforcement actions against Ripple Labs, Coinbase, Binance, Kraken's staking-as-a-service business, and various ICO issuers have built a substantial body of case law. The July 2023 Ripple ruling (programmatic sales to retail = not securities; institutional sales = securities) created a partial framework but left substantial ambiguity for ongoing cases.

Commodity regulation (CFTC). The Commodity Futures Trading Commission has explicit jurisdiction over crypto derivatives (futures, options, swaps) and has classified Bitcoin and Ether as commodities. CFTC enforcement has been particularly active against perpetual-swap operators offering unregistered products to US persons (BitMEX 2020 settlement, Binance 2023 enforcement, the 2022 Ooki DAO ruling that DAOs can be sued and held liable).

Money transmission (FinCEN + states). Any business engaged in 'money services' involving crypto must register with FinCEN as a Money Services Business (MSB) and comply with Bank Secrecy Act requirements (KYC, transaction monitoring, Suspicious Activity Reports). State-level money-transmitter licensing is required separately in each state where the business operates, with widely varying requirements. New York's NYDFS BitLicense (introduced 2015) is the strictest and most-cited.

Banking regulation (OCC, FDIC, Federal Reserve). Federal bank regulators have issued guidance allowing chartered banks to provide custody services for crypto (OCC Interpretive Letter 1170 in 2020, modified in 2025). Stablecoin reserves held at banks are subject to standard banking-deposit treatment. The Federal Reserve's Master Account access policy was a major friction point through 2023-2024.

Federal layer. All crypto exchanges, custodians, and money-transmission businesses operating in the US must register with FinCEN as Money Services Businesses. Registration requires designated compliance officers, AML programmes, transaction monitoring, customer-identification programmes, and ongoing recordkeeping. FinCEN registration is administrative, not a substantive licence — the substantive licence is the state-by-state money-transmitter regime.

State layer. Most states require a money-transmitter licence (MTL) for crypto-to-fiat exchange operations; the cost of obtaining all 50-state licences is typically estimated at $5-10 million in initial fees plus ongoing compliance. New York's BitLicense (administered by the Department of Financial Services) is a separate, dedicated crypto regulatory regime requiring substantial capital, governance documentation, and ongoing reporting; obtaining a BitLicense typically takes 12-24 months. California's DFPI introduced its Digital Financial Assets Law in 2025 with phased licensing requirements.

SEC + CFTC overlay. Even with FinCEN registration and state MTLs, a crypto exchange listing tokens that may be securities can face SEC enforcement; this is the substance of the SEC v. Coinbase and SEC v. Binance.US cases. Exchanges offering derivative products (futures, options, perpetual swaps) require CFTC registration as a Designated Contract Market (DCM) or Swap Execution Facility (SEF); the absence of registered US-based crypto perpetual venues until LedgerX / FTX US Derivatives reflects this constraint.

The Genius Act framework. The Genius Act of 2025 established the first comprehensive federal framework for payment stablecoins in the United States. Permitted stablecoin issuers must be either (a) federally-chartered banks or trust companies, or (b) state-chartered issuers meeting equivalent federal standards. Reserves must be held 1:1 in high-quality liquid assets (cash, short-term US Treasuries), be segregated from issuer general assets, and be subject to monthly attestation by independent accountants.

Pre-Genius landscape and ongoing state-level regimes. Before the Genius Act, stablecoin issuance was governed at state level — most prominently New York DFS's 2022 guidance setting reserve, attestation, and redemption requirements for NYDFS-supervised issuers (Paxos / Gemini / others). State-level frameworks remain operative for state-chartered issuers; the federal framework provides a national overlay.

Algorithmic stablecoins. US regulators have been notably skeptical of uncollateralised algorithmic stablecoins following the Terra/Luna collapse (May 2022). Multiple state regulators have explicit guidance treating uncollateralised algorithmic stablecoins as high-risk products; offering them to US retail investors creates substantial enforcement risk.

Property treatment (IRS Notice 2014-21). The IRS classifies crypto assets as property for federal tax purposes. Every disposition — sale, swap, payment, gift above the annual exclusion — is a taxable event with potential capital gain or loss. The cost-basis methods permitted are FIFO, LIFO (in limited circumstances), HIFO, and specific identification (well-documented).

Reporting (Form 8949 + Schedule D + 1099-DA). Individuals report crypto dispositions on Form 8949 and aggregate on Schedule D. From 2025 forward, US-based crypto exchanges and brokers are required to issue Form 1099-DA reporting customer activity (final regulations published in mid-2024). The 1099-DA regime will substantially increase IRS visibility into crypto activity from 2025 onward.

Specific event types. Mining and staking rewards are ordinary income at fair market value on receipt. DeFi swaps are dispositions (taxable). Airdrops are ordinary income on receipt. Hard-fork tokens are ordinary income on receipt (Rev. Rul. 2019-24). NFT sales and royalties follow capital-gains or ordinary-income treatment depending on facts. Wash-sale rules currently do not apply to crypto, but proposed legislation has aimed to extend them.

This is general background, not tax advice. US tax treatment depends on specific facts and is subject to ongoing IRS guidance changes. Consult a US-licensed tax professional or CPA experienced with crypto for personal tax decisions.

BSA / AML requirements. All FinCEN-registered crypto MSBs must implement Bank Secrecy Act compliance: written AML programmes, designated compliance officers, customer identification programmes, transaction monitoring, SARs, and ongoing training. The Travel Rule (FinCEN's $3,000 threshold for collecting and transmitting beneficiary information) applies to crypto MSBs.

OFAC sanctions enforcement. The Office of Foreign Assets Control administers US sanctions programmes that crypto businesses must comply with. The August 2022 designation of Tornado Cash as an SDN-listed entity (subsequently partially modified by court ruling) was the most significant precedent: it established that protocol-level smart-contract systems can be sanctioned, with implications for any US person interacting with the designated addresses. Several Tornado Cash developers faced criminal charges.

The Travel Rule and the FATF framework. The US is a FATF member and has adopted Travel Rule requirements consistent with FATF Recommendation 16. Crypto businesses transferring $3,000+ in customer funds must collect and transmit originator and beneficiary information; non-compliance is an enforcement priority for FinCEN.

SEC investor-protection framework. SEC enforcement against retail-targeted crypto products has emphasised the standard investor-protection principles: full disclosure of material facts, prohibition of fraud and manipulation, suitability for retail. The framework that applies depends on whether the product is treated as a security; commodity-classified tokens (BTC, ETH) are outside SEC retail-protection rules but inside CFTC anti-manipulation rules.

State consumer-protection layer. State attorneys general and consumer-protection agencies have brought independent enforcement actions against crypto firms. Notable examples include New York AG actions against KuCoin, Tether, Bitfinex (the iFinex settlement), and various securities-fraud actions; California DFPI enforcement post-Digital Financial Assets Law.

The ETF approval framework. Spot Bitcoin ETFs were approved by the SEC in January 2024 after a multi-year approval cycle; spot Ethereum ETFs followed in July 2024. ETF approval substantially increased retail access to BTC and ETH exposure through standard brokerage accounts under existing securities-law protections.

Broker reporting (1099-DA). The 1099-DA reporting regime, effective from 2025, requires brokers (a broad category that includes centralised exchanges and may extend to certain wallet providers and DeFi front-ends) to report customer crypto sales, with gross proceeds reporting in 2025 and cost-basis reporting from 2026. The IRS has stated its enforcement focus will sharpen as 1099-DA data flows in.

FBAR and FATCA exposure. US persons holding crypto on foreign exchanges may have reporting obligations under FBAR (FinCEN 114) and FATCA (Form 8938). IRS guidance on whether crypto held in foreign exchange accounts triggers FBAR has been inconsistent; recent guidance has leaned toward inclusion when the foreign account also holds fiat. This is an active area; consult a tax professional.

OFAC screening and chain analysis. Major US exchanges screen all incoming and outgoing transactions against OFAC sanctions lists using commercial chain-analysis tools (Chainalysis, TRM Labs, Elliptic). Funds traced to sanctioned addresses (e.g., post-Tornado Cash interaction) may be frozen by the exchange pending OFAC guidance; legal recourse for affected customers is limited.