This week’s regulatory headlines highlight a complex reality for the digital asset industry in North America. Although there is an evident push toward formalization, crypto regulation in the U.S. lacks the coherence necessary to move forward. From prediction markets to the state’s custody of assets, policymakers show a deep division today.
In this way, the market is caught between institutional maturation and a worrying political paralysis. According to official sources, this lack of unity weakens investor confidence in the sector currently.
One of the most high-profile events involves Representative Ritchie Torres, who is preparing restrictive legislation. This law seeks to ban federal officials from participating in prediction markets with non-public information.
Likewise, the case arises following a lucrative bet linked to the capture of Nicolás Maduro in Venezuela. Therefore, the transparency of blockchain technology is exposing weaknesses in public ethical rules. Consequently, Congress must face new conflicts of interest immediately to prevent further abuses in the future.
On the other hand, the Department of Justice (DOJ) generated strong controversy after selling 57 forfeited Bitcoin. This action contradicts an executive order that requires transferring such assets to the Strategic Bitcoin Reserve. Nonetheless, the sale was executed through Coinbase Prime without following strategic custody protocols.
Furthermore, this incident raises doubts about policy consistency among federal agencies today. Therefore, internal coordination in Washington regarding digital assets remains uneven and lacks a strategic vision for the industry.
Will the American political system overcome its divisions before the market moves to other jurisdictions?
Market structure reform also faces headwinds due to the upcoming midterm elections. An analysis from TD Cowen warns that the 2026 elections could delay any unified framework until 2027. Likewise, Senator Tim Scott has set January 15 as a hard deadline to move the bill forward. However, partisan caution threatens to stall negotiations for several additional months. In this way, cryptocurrencies once again fall victim to political polarization before the elections.
While the federal government stalls, several states and private actors are moving ahead with their own infrastructure. Wyoming, for instance, has already launched its own state-backed stablecoin recently. On the other hand, community bankers are demanding to close loopholes in stablecoin reward programs.
Likewise, the gap between financial innovation and federal policymaking is widening dangerously. It is expected that the market will continue to evolve rapidly despite the deadlock in Washington. Therefore, the cost of legislative delay could significantly affect national competitiveness.
