EU Crypto Regulation Targets Retail, USA Protects USD
There are not many areas in which the European Union is ahead of the United States. One such area, however, is the regulatory environment in the digital asset market. While the European Union has had legislation in place that defines the playing field for almost all types of crypto assets, the United States has so far relied on regulating only one segment of the digital asset market. How do the two economic powers’ approaches to crypto assets differ?
MiCA sets a unified framework across the EU
The fundamental difference between the European Union and the United States' approach to regulating digital assets lies in how broadly the rules of the game are defined. By early 2025, the European Union was already applying a single set of rules across all 27 member states. [1]
The EU regulation is known by the acronym MiCA (sometimes also MiCAR), which stands for Markets in Crypto-Assets Regulation. Importantly, MiCA also includes the regulation of stablecoins, i.e., digital currencies that are tied to the value of another, usually fiat currency.
Another characteristic feature of EU regulation of digital assets is that it aims to protect retail investors, or holders of crypto assets. MiCA largely guarantees that digital currencies should not be issued in the EU single market if the issuer has not obtained an appropriate license from the authorities. This license is granted only if the issuer complies with the conditions set out in the MiCA rulebook.
An issuer or provider of digital assets in the European Union should not disrupt or threaten the financial stability of the Union even after meeting MiCA’s conditions. Accordingly, the regulation is designed so that issuers have very limited chance of disrupting the stability of the EU’s financial markets. [2]
MiCA also takes into account the innovative nature of digital assets and the technologies on which they operate. The regulation is therefore not intended to threaten or reduce the EU’s innovation potential. If innovation levels are lower compared to the US, it is not the fault of MiCA regulation but of other structural factors (see, for example, the Draghi report [3] ).
The U.S. focuses only on stablecoins
In contrast, regulation in the United States in the field of digital assets is currently very narrowly focused—specifically, only on stablecoins. The regulation of stablecoins is based on a law signed by President Donald Trump on July 18, 2025. The acronym by which the law became known is striking: GENIUS – Guiding and Establishing National Innovation for U.S. Stablecoins. This is the first major federal law targeting the stablecoin market in the United States. [4]
The prevailing opinion among experts is that the main reason why the current U.S. administration pushed through the law is to strengthen the dominance of the U.S. dollar in global financial markets. The fact that it regulates stablecoins, i.e., digital assets tied to the U.S. dollar, confirms these voices.
Especially considering that U.S. dollar stablecoins are primarily backed by cash and short-term U.S. Treasuries, which creates additional demand for dollar-denominated government debt. Evil tongues even talk about a strategy of U.S. cryptomercantilism.
If the strategy proves successful, it will likely mean further dollarization of third countries, this time through cryptocurrency assets. For the United States, such a development will undoubtedly be favorable (and desired), while for the recipients of stablecoins pegged to the U.S. dollar, it may mean a violation of monetary sovereignty and financial stability.
Sources:
[2] https://www.europarl.europa.eu/RegData/etudes/STUD/2025/760274/ECTI_STU(2025)760274_EN.pdf
[3] https://commission.europa.eu/topics/eu-competitiveness/draghi-report_en