Tech-Neutrality or Tech-Sensitivity? Emerging Principles of Crypto-Asset Regulation in the U.S. and the E.U.

Crypto assets are subject to financial and bespoke regulations in the United States (US) and the European Union (EU). Regulatory effectiveness requires assets to be subject to the regulatory regime that addresses their risks best, whilst regulatory fairness requires market participants to be able to identify the regulatory standards they need to comply with. Whilst comparing the interplay between financial and bespoke crypto-asset regulations in the US and the EU, this article finds that the two polities might be embarking on different paths of crypto-asset regulation. The former moves in the direction of tech-sensitivity, whereas the latter sticks with strict tech-neutrality. This could be an early indicator of future divergent approaches to the currently unregulated crypto markets, such as decentralised finance and non-fungible tokens. As a result and considering the inherently global nature of crypto as an asset class, international cooperation and policy learning are likely to be of paramount importance for effective future crypto regulation.