In a fast-evolving digital economy, staying informed about regulatory changes is no longer optional. From new legislation in Washington to landmark policies in Brussels, the landscape for digital asset governance is shifting dramatically. By understanding key developments and anticipating future moves, stakeholders can transform uncertainty into opportunity.

U.S. Federal Legislative Developments

The U.S. Congress is taking bold steps to bring order to a market long defined by enforcement actions and fragmented oversight. In 2025, two major bills dominate the conversation: the CLARITY Act of 2025 and the FIT21 proposal.

The CLARITY Act of 2025 (H.R. 3633) introduces a comprehensive framework aiming to finally end regulatory ambiguity. Key highlights include:

• Digital asset defined as any value recorded on a distributed ledger.
• Classification into two primary categories: digital commodities and investment contract assets.
• Jurisdictional clarity: SEC oversees securities, CFTC governs commodities.

Under the Act, digital commodities are those intrinsically linked to blockchain operation, such as tokens used for governance, transaction fees, and network rewards. Investment contract assets include tokens sold under private investment arrangements and may receive a different level of scrutiny.

A useful timeline of legislative milestones appears below:

Federal Agency Approaches and Actions

Regulatory bodies are aligning to implement legislative intent. Since January 2025, the new administration has prioritized clear regulatory expectations and legislative clarity, reflecting a global push toward harmonized digital asset policy.

The SEC has taken decisive steps, notably the rescission of SEC Staff Accounting Bulletin 121. This removal of guidance that previously barred banks from offering digital asset custody is pivotal. While banks still need sign-off from prudential supervisors to ensure safety and soundness, the removal of custody barriers signals growing institutional acceptance.

The FDIC has followed suit. On March 28, 2025, FIL-7-2025 eliminated the requirement for FDIC-supervised institutions to obtain pre-approval for crypto activities. Simultaneously, the FDIC issued an advisory reminding banks that deposit insurance does not extend to assets held by unaffiliated crypto firms, urging robust third-party risk management.

Building a Comprehensive U.S. Framework

Industry experts and policymakers agree that a holistic regime must balance innovation with consumer protection. The FIT21 report outlines several pillars that together form a robust framework:

• Tailored registration regimes for trading platforms and broker-dealers.
• Custody requirements that safeguard customer holdings and offer institutional choice.
• Clear disclosure rules distinguishing commodities from securities.
• Transitional compliance periods and recognition of existing registrations.
• Federal preemption with defined cross-border limits and possible international reciprocity.

By endorsing these principles, the U.S. can foster a vibrant market while minimizing regulatory fragmentation.

International Regulatory Landscape

Beyond U.S. borders, jurisdictions are crafting comprehensive rules to govern digital services and digital assets. The European Union’s Digital Services Act (DSA) and Data Privacy frameworks set a high bar for transparency and accountability.

Under the DSA, any digital intermediary serving over 10% of the EU population—roughly 45 million users—must comply with stringent obligations. These include, but are not limited to:

• Transparency reporting of content moderation.
• Notice-and-action procedures for illegal or harmful content.
• Dedicated points of contact for user inquiries and law enforcement cooperation.

Complementing the DSA, the EU Asset Freeze and Sanctions regime mandates risk-based due diligence for transactions involving freeze orders or sanctioned parties. Businesses must assess compliance requirements tailored to their operations, reinforcing a culture of proactive risk management.

Market Implications and Challenges

The combined effect of U.S. and EU initiatives is reshaping the global digital asset marketplace. While regulatory clarity in Europe has attracted major trading venues and custodians, the U.S. has historically lagged. The recent fit-for-purpose regulatory regimes being discussed promise to level the playing field.

Nonetheless, significant challenges remain. State and federal laws sometimes conflict, creating a regulatory gray zone that can deter market entrants. Ongoing lobbying efforts aim to secure clear preemption rules and reasonable transition timelines.

Institutional participation is poised to increase, driven by the removal of custody barriers and evolving bank charters. Yet banks will need to hire or train staff dedicated to monitoring enforcement actions, interpreting new rules, and updating internal controls in real time.

Looking Ahead

As Congress debates the CLARITY Act throughout 2025, stakeholders should prepare for several possible outcomes:

First, debate over the precise division of SEC and CFTC authority could lead to refinements in the final text. Second, transitional compliance provisions may be extended to ease market disruption. Finally, international reciprocity agreements could emerge, fostering cross-border cooperation.

Digital asset market participants—especially exchanges, custodians, and banking institutions—should adopt a strategic approach:

1. Establish dedicated teams to track legislative and agency updates daily.

2. Engage in industry working groups and regulatory comment periods to shape emerging rules.

3. Invest in technology that automates compliance checks and reporting to reduce manual risk and enhance auditability.

By embracing these steps, organizations can transform rapid regulatory change from a source of anxiety into a catalyst for innovation and growth.

Ultimately, monitoring regulatory shifts in digital assets is not merely a compliance task—it is a strategic imperative. Those who stay informed, remain adaptable, and engage proactively will lead the next wave of digital finance, ensuring that markets are both vibrant and secure.