Latest changes in digital asset law in the USA, China, and the UAE show how regulation is turning into a form of financial infrastructure rather than just a compliance burden. The U.S. is racing to lock in a federal market structure, China is centralizing control through the digital yuan and strict bans on unauthorized activity, while the UAE is scaling a tightly regulated framework for stablecoins and tokenized assets. Together, these moves are reshaping where and how crypto and tokenization can operate in 2026.
In 2026, the global conversation has clearly shifted from “Will digital assets be regulated?” to “How exactly will they be run day‑to‑day?” Law is no longer just a set of guardrails around crypto markets; it is becoming the underlying architecture for stablecoins, tokenized real‑world assets (RWAs), and reporting of digital asset activity for tax and compliance purposes.
United States: from debate to federal market structure
U.S. cryptocurrency legislation is entering a decisive phase. After years of overlapping guidance and enforcement‑driven policy, lawmakers are moving toward a comprehensive framework designed to clarify which agencies oversee which parts of the digital asset ecosystem.
At the center is the proposed Clarity Act, targeted for implementation in 2026. The legislation is structured to create a clear regulatory perimeter for digital assets and to resolve the long‑running jurisdictional struggle between the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC).
Under the current draft, the CFTC would gain primary authority over most digital assets that function as commodities, especially those used for payments, trading, or as store‑of‑value tokens. As cryptocurrency and blockchain investor William Quigley, co‑founder of WAX and Tether (USDT), explained, the bill is designed to draw a line between commodity‑like tokens and securities:
> “The Clarity Act, which is expected to become law this year, aims to distinguish between commodities and securities, requiring exchanges and dealers to register with the CFTC and adhere to consumer protections.”
This shift would force U.S. trading venues and intermediaries to choose a lane: register as CFTC‑supervised entities for spot and derivatives trading of commodity‑type digital assets, or fall under securities law when dealing with tokenized instruments that resemble traditional equity or debt.
Political timing is crucial. Treasury Secretary Scott Bessent has called for a “spring signing” of the Clarity Act, emphasizing that the 2026 midterm elections compress the window for bipartisan cooperation. If the bill stalls, the U.S. risks entering the election cycle with the same fragmented regulatory regime that has driven compliance uncertainty and outbound capital flows.
While the Clarity Act focuses on market structure, complementary efforts are emerging around stablecoins and tax. Policymakers are debating federal standards for stablecoin reserves, redemption rights, and custody, as well as tightening reporting rules on digital asset gains and cross‑border transfers. The direction of travel is clear: by 2026, operating in the U.S. crypto market will mean functioning inside a fully regulated, federally defined system.
For U.S. businesses and developers, this transition will be disruptive but clarifying. Well‑capitalized exchanges, custodians, and institutional platforms are likely to benefit as smaller, non‑compliant operators exit or relocate. On the other hand, the boundary between “utility tokens” and securities will narrow, making it harder to launch token projects without legal and compliance infrastructure from day one.
China: centralized control through e‑CNY and strict prohibitions
China is pursuing a very different model, one in which the state retains near‑total control over monetary innovation. February 2026 marked another tightening of the rules around digital assets, with regulators doubling down on the central role of the digital yuan (e‑CNY) and closing off alternative channels such as yuan‑pegged stablecoins and unapproved tokenization schemes.
A joint notice issued on February 6, 2026, by eight government agencies reaffirmed that all virtual currency activities remain illegal. This time, the message was sharpened to focus specifically on stablecoins that mirror sovereign money. Authorities made clear that any attempt to issue or distribute tokens that function like money, outside the state‑backed e‑CNY framework, would be treated as a violation.
Yifan He, founder and CEO of Red Data Tech, highlighted the policy pivot around the definition of stablecoins:
> “The authorities removed stablecoin from the definition of cryptocurrencies. Compared with earlier documents, stablecoin is no longer grouped together with cryptocurrencies and RWAs. It’s only mentioned to say that a ‘stablecoin pegged with fiat functions partially as money.’ This is a huge policy shift regarding stablecoins. It might open the door for Chinese banks in Hong Kong to apply for a stablecoin license there.”
This adjustment signals two things at once: first, Beijing wants to distinguish between purely speculative crypto activity and tokens that may one day be integrated into the formal financial system; second, any such integration will occur on the state’s terms, primarily via licensed banks and financial institutions, not through open crypto markets.
The new rules explicitly ban any entity-domestic or foreign-from issuing renminbi‑pegged stablecoins outside mainland China without explicit approval. The intention is to prevent offshore RMB‑linked tokens from competing with the e‑CNY or becoming parallel channels for capital flows.
The crackdown extends beyond issuance. Domestic Chinese organizations and their subsidiaries are now strictly prohibited from launching virtual currencies or conducting RWA tokenization abroad without prior consent from authorities. Yifan He underlined the severity of this expansion:
> “Helping illegal crypto business from inside China (even for projects outside China), including promotion, IT development, and advisory, will face severe criminal punishment. This goes next level.”
On RWAs, the picture is similarly restrictive. While some observers initially interpreted the 2026 documents as hinting at a future RWA framework, the actual language is far more prohibitive. Approval is required for any tokenization tied to onshore assets, and in practice, the new regime amounts to a near‑total freeze on RWA activity in the open crypto space.
> “In the circulars, RWAs are totally banned. Recently, people from the RWA industry tried to blur the line between RWAs and ‘tokenized securities’ and claimed the government had provided a path to legalize RWAs. It has not. The path is now a total ban,” Yifan noted.
There is, however, a narrow “bright side”: tokenized securities are conceptually allowed, but only within the existing licensed, highly regulated capital market infrastructure.
> “The circulars do provide a clear path for ‘tokenized securities.’ But because they are ‘securities,’ issuance and trading must go through licensed entities. This doesn’t really create opportunities for tech or crypto companies. It’s a new product line for existing underwriters and stock exchanges. IPOs and fundraising won’t be any easier. Asset owners who want to ‘tokenize’ must receive CSRC approval-the same procedures as listing a Chinese company on foreign stock markets,” Yifan explained.
In effect, China is embracing digital finance, but only within a tightly centralized architecture anchored by the e‑CNY and supervised capital markets. Open‑ended crypto experimentation-whether via stablecoins, RWAs, or offshore projects-continues to be systematically shut down.
Mainland China vs. Hong Kong: one country, two digital asset paths
While Beijing reinforces its prohibitive stance, Hong Kong is deliberately carving out a more open, though still cautious, environment. The territory is experimenting with regulated stablecoins, tokenized bonds, and licensed crypto trading platforms, aiming to serve as a bridge between global capital and controlled Chinese financial innovation.
This creates a nuanced “one country, two systems” reality in digital assets. On paper, rules in Hong Kong and on the mainland are distinct. In practice, mainland entities must navigate strict prohibitions on participating in offshore crypto or tokenization activities without approval, even if those activities are legalized in Hong Kong.
For multinational firms, this divergence presents both opportunity and risk. Hong Kong may serve as a testing ground for institutional stablecoins and tokenized products, but any link to mainland capital, users, or infrastructure must be handled with extreme care to avoid breaching Beijing’s red lines.
United Arab Emirates: regulated growth and scaling of stablecoins
The United Arab Emirates is positioning itself at the opposite end of the spectrum from China, seeking to attract global digital asset businesses through clear rules, licensing, and a strong emphasis on compliance. In 2026, the UAE is moving from pilot projects to scaled implementation, especially in the areas of regulated stablecoins and tokenized real‑world assets.
Regulators in Abu Dhabi and Dubai have been building parallel but coordinated frameworks that define what a compliant digital asset business looks like. This includes licensing for exchanges, custodians, and brokers, along with specific categories for asset‑referenced tokens and fiat‑backed stablecoins.
The latest policy trend in the UAE focuses on enabling stablecoins to plug directly into the country’s financial system, subject to robust safeguards. Stablecoin issuers are increasingly required to maintain high‑quality reserves, undergo frequent audits, and implement strict anti‑money‑laundering and counter‑terrorist financing controls. Some are being integrated into payment systems and pilot programs that test cross‑border settlement and on‑chain trade finance.
At the same time, the UAE is actively promoting tokenization of traditional assets-such as real estate, funds, and commodities-in regulated environments. Rather than banning RWAs, the approach is to channel them through licensed entities and sandboxes where issuance, trading, and custody can be monitored. This gives institutional players a clearer route to launch on‑chain products without falling into regulatory limbo.
Tax and reporting are also tightening as the UAE’s broader corporate tax regime matures. While the country remains relatively tax‑friendly compared to Western jurisdictions, digital asset businesses are now expected to meet international standards on transparency and information exchange, especially when dealing with foreign investors.
For crypto firms, the UAE’s model offers a middle ground: more freedom to innovate than in heavily restrictive jurisdictions, but within a framework that is explicitly designed for institutional comfort rather than anonymous, unregulated activity.
Law as infrastructure: three regulatory archetypes
The 2026 developments in the U.S., China, and the UAE reveal three distinct regulatory archetypes that are likely to shape the digital asset landscape over the next decade:
– Infrastructure‑driven liberalization (UAE): Regulation as an enabler, focused on creating safe, licensed pathways for stablecoins, exchanges, and RWAs to scale.
– Centralized control (China): Digital assets allowed only when state‑run or fully embedded within traditional licensed entities, with open crypto markets effectively prohibited.
– Adversarial‑to‑managed transition (U.S.): A shift from enforcement‑led policy and ambiguity toward a codified, federal market structure dominated by large, compliant intermediaries.
For businesses and investors, where to build or allocate capital increasingly depends on which of these models best matches their risk appetite and product strategy.
Implications for stablecoins and RWAs
Across all three jurisdictions, stablecoins and tokenized real‑world assets sit at the center of policy debates because they directly touch the traditional financial system.
– In China, fiat‑pegged stablecoins that resemble money are effectively outlawed unless they are under state control, reinforcing the primacy of the e‑CNY.
– In the U.S., stablecoins are likely to become a regulated financial product class, with clear rules around reserves, disclosures, and systemic risk, especially once the Clarity Act and companion stablecoin measures are finalized.
– In the UAE, stablecoins are being positioned as a core component of digital finance infrastructure, with regulations designed to integrate them into payments, trading, and cross‑border settlement.
RWAs follow a similar pattern. Where China sees open RWA tokenization as a risk to capital controls and market stability, the U.S. and UAE view it as an extension of capital markets that must be brought under securities and financial services regulation, rather than banned outright.
What this means for builders and investors
For developers, exchanges, and protocol teams, navigating these shifting rules requires strategic location decisions and robust compliance planning:
– Jurisdictional arbitrage is narrowing. Rapidly tightening global tax reporting and AML expectations make it harder to simply relocate and operate without oversight.
– Institutional alignment is increasingly essential. The winning projects in 2026 are likely to be those that can integrate with banks, brokers, and large custodians rather than remain fully decentralized and unregulated.
– Token design will be shaped by law. Whether a token is treated as a commodity, a security, or quasi‑money will determine everything from its distribution model to listing options and investor base.
Investors, in turn, must factor regulatory trajectories into valuation. Tokens and platforms that are structurally incompatible with emerging frameworks in major economies may struggle to attract capital, regardless of their technical merits.
Looking ahead: fragmentation or convergence?
Despite divergent paths, there are early signs of convergence around some core principles: consumer protection, systemic stability, and traceability of funds. The specifics differ-China’s bans, America’s market structure, the UAE’s licensing focus-but the underlying aim is similar: to pull digital assets out of the legal gray zone and into recognizable financial architecture.
The next phase will likely center on cross‑border interoperability and recognition. As more countries formalize stablecoin and RWA rules, pressure will mount for standards that allow regulated tokens to move between jurisdictions without falling into legal uncertainty each time they cross a border.
What is clear in 2026 is that “no man’s land” for digital assets is shrinking. Whether through prohibition, control, or structured integration, the law is now the backbone of the digital asset ecosystem.
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The opinions and interpretations in this article reflect the author’s personal views and do not necessarily align with those of the crypto.news editorial team.