MiCA vs. US: Why Europe Has a Rulebook and America Doesn't

Tokenization is moving from narrative to production. BlackRock's BUIDL and Franklin Templeton's on-chain funds are real, regulated products with billions of dollars in assets. The question is which jurisdictions will give this market a coherent legal foundation.

Europe now has an answer in the form of MiCA. The United States does not.

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1. What MiCA actually does

The Markets in Crypto-Assets Regulation (MiCA) was adopted in 2023. It entered into force in June 2023, with different parts applying on a staggered schedule:

• rules for asset-referenced tokens and e-money tokens started to apply on 30 June 2024
• the broader regime for crypto-asset service providers applies from 30 December 2024

MiCA covers three main buckets:

1. Asset-referenced tokens (ARTs)

Tokens that aim to maintain a stable value by referencing a basket of assets such as currencies or commodities.

2. E-money tokens (EMTs)

Single-currency stablecoins that function similarly to e-money. Issuers must be authorized, hold reserves, and guarantee redemption at par.

3. Other crypto-assets

Utility tokens and other digital assets that are not already covered by existing EU securities or derivatives law.

On top of that, MiCA defines crypto-asset service providers (CASPs) and gives them a licensing and passporting regime. Once authorized in one EU member state, a CASP can operate across the bloc, subject to conduct and prudential rules.

Key features relevant for tokenization:

• disclosure obligations through a standardized whitepaper
• safeguarding rules for client assets
• capital and governance requirements for service providers
• size thresholds and extra obligations for "significant" stablecoins

Supervisors are already using these powers. ESMA has warned firms not to market unregulated products as if they were MiCA-compliant, and the European Commission is examining how well the regime protects holders of e-money tokens and stablecoins.

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2. Why MiCA matters for tokenization

MiCA is not a tokenization law in the narrow sense, but it does three important things for real-world assets:

1. Classification clarity

Issuers can map a product to an existing bucket and know which obligations apply. This lowers the legal uncertainty for tokenized money market funds, structured notes, or stablecoin-like products.

2. Passporting for infrastructure

Custodians, exchanges, and brokers that want to support tokenized funds can operate across the EU once they meet CASP requirements. That matters for liquidity and interoperability.

3. Regulatory comfort for institutions

When regulated funds or banks buy a tokenized treasury fund, they can point to a clear regime for custody, disclosure, and redemption rights. That is already showing up in practice. Franklin Templeton has launched tokenized U.S. Treasury funds under European rules, and UCITS-compatible tokenized funds are beginning to appear.

MiCA is not perfect. National authorities still have discretion in licensing, and the treatment of complex DeFi structures is not fully settled. But as a baseline rulebook, it exists and is already influencing product design.

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3. The US: powerful regulators, no unified framework

The United States sits at the other extreme.

3.1 Regulation by enforcement

For most of the last cycle, the Securities and Exchange Commission has led with enforcement rather than bespoke rulemaking. The approach has been that existing securities laws already cover most tokens and platforms, while industry and many lawmakers criticize this as "regulation by enforcement".

Federal courts have in several cases allowed the SEC to proceed against major exchanges, endorsing this approach in the absence of new statutes. The result is a landscape where:

• some tokens have been deemed securities in specific cases
• others are treated as commodities under CFTC jurisdiction
• stablecoins and tokenized funds sit in a gray area influenced by banking, payments, and securities law

CFTC leadership has repeatedly warned that the lack of a comprehensive framework for spot crypto markets is a risk and has called on Congress to act.

3.2 Legislative attempts that stop short

There have been serious attempts to change this:

• Lummis-Gillibrand Responsible Financial Innovation Act – a Senate bill that would divide jurisdiction between the SEC and CFTC, set consumer protections, and impose stablecoin reserve requirements.
• FIT21 (Financial Innovation and Technology for the 21st Century Act) – a House bill that passed in May 2024, aiming to clarify when a digital asset is a security versus a commodity and to create a unified regime for digital asset markets.
• GENIUS Act and other stablecoin bills – bipartisan proposals to require one-to-one reserves, prohibit algorithmic stablecoins, and set a licensing framework for issuers.

As of late 2025, the US still does not have a MiCA-style comprehensive statute in force. Bills have passed one chamber or one committee, but there is no single federal law that answers basic questions for tokenized assets.

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4. Why this matters specifically for tokenization

The absence of a unified framework has three concrete effects on tokenization in the US.

4.1 Product design and distribution

Tokenized money market funds and treasuries exist in the US, but each one is a bespoke legal engineering exercise. Franklin Templeton's on-chain fund relies on existing 1940 Act mutual fund rules plus a custom blockchain transfer agent system. BlackRock's BUIDL uses a private offering structure paired with a registered fund and a specialist transfer agent.

Without a clear statute, each issuer and law firm has to reason from first principles about:

• how token holders are recorded
• which parts of the stack are regulated entities
• how cross-border distribution works
• what happens if tokens circulate beyond the intended investor base

That slows innovation and raises costs.

4.2 Intermediary risk

Tokenization only delivers real benefits if settlement, custody, and collateral management are robust. In the US, different regulators oversee different parts of that chain, and guidance on tokenized collateral, risk weighting, or bankruptcy treatment is fragmented.

MiCA, by contrast, provides a consistent set of rules for CASPs that safeguard client assets and clearly separates the firm's balance sheet from customer holdings. That does not prevent failures, but it gives both institutions and supervisors a common language.

4.3 Global competition

The FIT21 summary puts it bluntly: blockchains and digital assets can be "building blocks of the next generation of internet technology", but lack of clarity will push activity offshore. Europe, parts of the Middle East, and some Asian jurisdictions are now marketing themselves as tokenization hubs precisely because they can point to a dedicated rulebook.

If the US wants to remain the primary venue for dollar-based tokenized assets, it needs something more explicit than case law and decades-old securities statutes.

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5. What a sane US rulebook could look like

A realistic path does not need to copy MiCA line by line, but it would borrow the structure.

1. Horizontal categories

- payment stablecoins

- asset-backed tokens that behave like securities or fund units

- utility and governance tokens

Each with clear regulatory homes and disclosure obligations.

2. Unified market rules for trading venues and custodians

A single statute that defines what a digital asset trading venue is, how customer assets must be segregated, and what capital and compliance standards apply, regardless of whether the primary regulator is the SEC or the CFTC.

3. Explicit treatment of tokenized funds and treasuries

Clarify when tokenized interests in an existing fund are just a new recordkeeping technology versus a new security, and how banks and brokers may hold them for clients and as collateral.

4. Stablecoin framework aligned with banking and payments law

The GENIUS Act and similar proposals already point here: fully reserved, redeemable at par, subject to anti-money-laundering and sanctions rules, with restrictions on who can issue.

5. International compatibility

Coordination with MiCA and other regimes on definitions of ARTs, EMTs, and security-like tokens would reduce friction for global issuers.

None of this is exotic. Lawmakers already have draft text on the table. What is missing is political agreement and prioritization.

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6. Why clarity is urgent

Tokenization is small relative to the broader securities and bond markets, but it is not trivial any more. The tokenized Treasury segment alone has grown several hundred percent in the last couple of years, with single funds approaching $3 billion in assets and being used as collateral on large exchanges.

At the same time, regulatory bodies are warning about risks from unregulated or lightly regulated crypto markets. Without comprehensive legislation, enforcement alone cannot keep up with the pace of innovation.

MiCA is far from perfect, but it has changed the conversation in Europe from "is this legal" to "which MiCA bucket does this fall into and what are the obligations". That is exactly the kind of foundation tokenization needs.

If tokenization is where the internet was in the mid-1990s, as Larry Fink has suggested, then we are still early. The jurisdictions that write clear, technology-aware rules now will own a disproportionate share of the next decade of financial infrastructure.

For Europe, MiCA is that bet. For the US, the window to write its own version is open, but not indefinitely.