Grok rewritten based on the chainless.hk series of the same name
Since the original series was written (primarily based on 2024 observations), global cryptocurrency regulation has undergone a significant shift: from “enforcement-heavy” approaches (especially the U.S. Gensler era) toward “framework clarity + industry promotion.” Many previously criticized issues—“classification confusion,” “squeezing the gourd only for the ladle to pop up,” and “severe suppression of innovation”—have been partially alleviated in 2025–2026, though new challenges have emerged.
- United States: Gary Gensler officially departed on January 20, 2025. Under new SEC Chair Paul Atkins, the SEC significantly reduced cryptocurrency enforcement actions (only about 13 in 2025, a decline of over 60% year-over-year), proactively withdrawing or terminating several high-profile cases, including parts of those against Coinbase and Binance. The Ripple case fully concluded in August 2025 (both sides dropped appeals, maintaining the $125 million fine but establishing the precedent that programmatic sales are not securities), granting XRP substantial clarity and driving rapid development of related ETFs. In July 2025, President Trump signed the GENIUS Act into law, establishing a federal framework for stablecoins (requiring 100% reserves, monthly disclosures, etc.). In early 2026, the SEC and CFTC advanced joint rulemaking (Project Crypto), while market structure bills (such as the CLARITY Act) continue progressing in Congress, with major breakthroughs expected within 2026. Overall, the U.S. has shifted from being the largest source of regulatory uncertainty to a relatively clear global competitive advantage zone, partially validating the original view that “clear standards are superior to chaotic enforcement.”
- Hong Kong: The criticized “virtual asset” positioning deviation and high compliance costs (exchanges exceeding $20 million) persist, but Hong Kong accelerated its “catch-up” in 2025–2026. The Stablecoins Ordinance took effect in August 2025, with the first batch of stablecoin licenses issued in early 2026 (first approvals expected around March); plans are underway within 2026 to advance legislation for dealer and custodian licenses, extending to advisory and asset management services. Measures such as institutional tax incentives, tokenization pilots, and liquidity support have been introduced to solidify its position as an Asian digital asset hub. While high compliance thresholds remain a drawback, the policy direction has shifted from “cautious observation” to “active attraction.”
- Global Trends: The EU’s MiCA has been fully implemented since 2025 (though execution varies across member states); Dubai/Abu Dhabi (VARA/FSRA) Rulebook 2.0 is in place, maintaining Middle East leadership; Singapore and Japan’s stablecoin frameworks have matured. Cryptocurrency competition has indeed become national competition, but the “talent nomad” pattern has adjusted: the U.S., leveraging new policies, market depth, and Bitcoin strategic reserves, has re-attracted top projects and talent; Hong Kong, Dubai, and Singapore form multipolar competition; mainland China’s influence remains marginalized.
- Meme Coins and Fraud: After the 2024 meme coin frenzy, institutional inflows continued in 2025–2026 (Bitcoin/Ethereum ETF scales expanded) alongside regulatory framework implementation, compressing space for pure speculative plays, though new gray areas (such as prediction markets and on-chain assets) continue testing boundaries.
Trump Policies: The originally mentioned “citizenship for holdings over 500,000” was not directly realized, but the 2025“ Trump Gold Card” program (accelerated green card pathway via 500,000” was not directly realized, via 1 million donation, with higher tiers up to $5 million in some versions) — though not crypto-exclusive — objectively attracts high-net-worth crypto practitioners to immigrate, aligning with the logic of “harvesting top talent.”
Overall Assessment: The original insights — that “industrial-era frameworks do not fit internet-native characteristics,” the need for “transparency + community,” “if it can’t be regulated, don’t force it,” and “global consensus” — remain profound and forward-looking. 2025–2026 practice partially confirms: aggressive regulation once caused trillions in market cap evaporation, while shifting to clear frameworks, embracing community voices (Musk-style pressure continues), and distinguishing decentralized vs. controlled projects has accelerated healthy industry growth. However, new risks emerge — as global coordination tightens, it may reinforce centralized compliance demands; truly native Bitcoin-style projects’ “practically unregulatable and no need for forced regulation” space is preserved, but boundaries are continually tested.
Main Text (Core views preserved from original, with minor transitions adjusted for connection to update commentary)
Regulatory Thinking and Classification Confusion
Cryptocurrencies encompass dual attributes of securities and commodities. Hong Kong’s SFC uses “virtual assets” rather than “virtual currency,” which does involve some deviation in positioning. Bitcoin is essentially a store-of-value currency and should not be fully shoehorned into traditional securities regulatory frameworks. Treating cryptocurrencies entirely as traditional stocks is like “dressing a man in women’s clothes”—the ecosystem structures are completely different. In the past, U.S. and Hong Kong regulatory approaches were roughly equivalent, both exhibiting severe misalignment. But as noted in the update commentary, the U.S. has significantly shifted to clear frameworks since 2025, partially alleviating this issue.
Consequences of Poor Regulation: Pressing Down the Gourd Only for the Ladle to Pop Up
Lack of unified clear standards in regulation leads to imbalanced market ecology — chopping down big trees (compliant projects), spraying herbicide (strict controls), ultimately leaving neither trees nor grass, just barren wasteland. The 2024 meme coin frenzy was precisely the result of the U.S. SEC’s unclear classification and overreach. In the Gary Gensler era, he couldn’t even answer whether Ethereum was a security; the Ripple lawsuit was absurd, and the judgment ridiculous—all due to the absence of prior clear standards. Practice proves: strict regulation did not effectively curb fraud but severely suppressed industry development, with many major exchanges withdrawing applications. However, in 2025–2026, with Gensler’s departure, Project Crypto advancement, and GENIUS Act implementation, this “suppression” effect has significantly weakened.
Cryptocurrency Competition Has Become National Competition, Talent Wanders Globally
Crypto hotspots rotate rapidly: Hong Kong → Singapore (policy) → Dubai (cost) → Thailand (culture). China’s past policy aftermath lingers. Attracting “nomadic talent” requires aligning with internet-era logic—for example, if Trump had introduced more direct crypto talent incentives (such as holding thresholds or donation pathways), it could harvest top talent. The fact that the top three U.S. exchanges were all founded by ethnic Chinese shows the extremely high proportion of Chinese in the crypto field. In reality, the 2025 Gold Card program along with Bitcoin reserve initiatives has already made the U.S. a talent magnet again.
Transparency + Community Are the Two Magic Weapons of Crypto Regulation
The internet’s underlying layer is borderless, non-hierarchical, peer-to-peer—cryptocurrencies align highly with this. Industrial-era pyramid-style, closed decision-making is severely outdated. Musk used X community transparency to pressure and successfully cut a thousand-page bill down to a hundred pages, proving that the people’s voice can directly influence decisions. Crypto regulation should embody internet spirit rather than cling to hierarchical bureaucratic thinking. Losses from officials’ erroneous policies (trillions level) far exceed market crimes (hundreds of billions), yet accountability is rare. This view continues to be repeatedly validated in 2025–2026 community-policy interactions.
Regulation Needs Global Organizations and Consensus
The internet knows no borders; regulation should have global industry foundations/associations to form consensus and counter “outsiders leading insiders.” Gary Gensler-style governance caused trillions in losses with no one held accountable. Today, global frameworks (such as MiCA and GENIUS Act) are coordinating, but true cross-border consensus mechanisms are still lacking.
Long-Arm Jurisdiction and Decentralized Project Regulation Principles
No controller, fully decentralized/anonymous projects → currently practically unregulatable and no need for forced regulation (Bitcoin as the classic example).
Projects with controllers → should require real-name development and accept regulation; projects unwilling to reveal real names are instead suspicious. Core principle: if it can’t be regulated, don’t regulate—don’t use adult logic to forcibly manage a child’s world. This principle is partially embodied in the current U.S. “non-securities majority” orientation and Hong Kong’s layered regulation.
Five Core Characteristics of Cryptocurrencies Determine Regulatory Boundaries
Personal sovereignty, community autonomy, transparency, fairness and justice, immutability. Bitcoin basically achieves the first four (no master automatically satisfies justice), requiring no regulation. Other projects deviating from these characteristics are where regulation should intervene.
Regulatory Effectiveness Evaluation Standards (Simplified Version)
- Does it accept transparency supervision? Is there community interaction?
- Is the industry growing (number of enterprises, trading volume, influence)?
- Does it reduce rather than raise compliance costs (Hong Kong exchange compliance costs exceeding $20 million as a counterexample)?
- Does it promote genuine innovation rather than spawning more invalid meme coins/scam disks?
Truly suitable cryptocurrency regulation should be based on its internet-native characteristics rather than rigidly transplanting industrial-era frameworks. Next time, we’ll discuss specific methods.
