Crypto’s Rules Are Here. 2026 Will Be About Making Them Work

The past two years finally gave the crypto industry something it has long lacked: rules. After a decade of ambiguity, US policymakers have begun stitching together a regulatory framework.

The Financial Accounting Standards Board issued ASU 2023-08, allowing in-scope crypto assets to be brought onto balance sheets at fair value. Congress followed with the GENIUS Act, establishing a federal structure for payment stablecoins. The IRS modernized crypto tax reporting with Form 1099-DA.

This emerging foundation is significant. But the hard work of turning rules into meaningful compliance and functional oversight is just beginning. Companies and practitioners should expect 2026 to be less about crafting new regulations and more about refining, connecting, and operationalizing the ones in place.

Accounting Questions

ASU 2023-08 was a milestone, but its scope remains narrow. The rule applies only to fungible, cryptographically secured, blockchain-hosted tokens whose value derives solely from their existence on a distributed ledger and that confer no enforceable rights. While this definition captures the two largest cryptocurrencies, Bitcoin and Ethereum, it excludes several of the market’s fastest-growing segments.

Stablecoins are a prominent example. Their market is expanding rapidly under the GENIUS Act, yet ASU 2023-08 doesn’t address them. Companies are asking whether stablecoins qualify as cash equivalents, an increasingly urgent question as adoption accelerates.

The rule also excludes the token types (e.g., self-issued, wrapped, and non-fungible tokens) and decentralized finance activities where accounting ambiguity is greatest. The crypto-native activities raise questions that traditional finance hasn’t had to confront, notably around control and revenue recognition. They also strain core assumptions in US General Accepted Accounting Principles; for instance, the revenue-recognition model assumes an identifiable customer, yet in mining or staking, the “counterparty” is the protocol.

The FASB is aware of these gaps and has added new projects to address tokens excluded by ASU 2023-08 and to clarify derecognition for crypto transfers, with the goal of reducing diversity in practice.

Beyond scope, applying the fair-value model to crypto assets will continue to require judgment. Crypto markets rarely offer the orderly pricing structure that the model presumes. Identifying a principal market is difficult when tokens frequently trade across fragmented venues with inconsistent prices and thin liquidity.

In addition, crypto markets operate 24/7, with no traditional end-of-day anchor. Companies will exercise discretion in choosing exchanges, pricing services, and methodologies and auditors will need to evaluate and corroborate those choices.

Stablecoin Questions

The GENIUS Act supplies a federal definition of “payment stablecoins” and establishes who may issue them, how they must be backed, and what must be disclosed. But like ASU 2023-08, it provides the regulatory outline, not the operating manual.

The act’s core requirement is that payment stablecoins be fully backed by high-quality liquid assets and subjected to monthly independent attestations. These examinations are narrower than audits, and the central questions are what they must cover and who may perform them.

The 2025 criteria developed by the American Institute of Certified Public Accountants are quickly becoming the de facto benchmark for stablecoin reporting. The criteria outline the core elements of a compliant proof-of-reserves report: redeemable tokens outstanding, the redemption assets available, and a reconciliation between the two. They also call for disclosure of redemption terms, reserve composition, custody arrangements, valuation methods, maturity profiles, and material events.

One remaining ambiguity is examiner eligibility: The act’s reference to a “registered public accounting firm” would exclude many qualified CPAs who aren’t registered with the Public Company Accounting Oversight Board, a limitation the AICPA has urged the Department of Treasury to reconsider.

Monthly attestations alone aren’t enough to build credibility or prevent operational failures; a strong internal control system is essential. The GENIUS Act doesn’t mandate internal controls over token issuance, smart-contract governance, or reserve management. The House-passed Clarity Act sought to address this gap before stalling in the Senate, and whether Treasury will do so through rulemaking remains uncertain.

Finally, there is a broader landscape to watch. The GENIUS Act covers only “payment stablecoins,” leaving other stablecoins outside federal oversight. Payment stablecoins offer low-cost payments and instant settlement, but they aren’t permitted to pay interest. If issuers nonetheless pursue “backdoor yield” arrangements, they could draw deposits away from banks. Banks, however, could also enter the stablecoin market themselves. Much remains to be seen as competition between stablecoin issuers and banks unfolds.

Because issuers must hold high-quality liquid assets, stablecoin growth is increasingly tied to the banking system and the Treasury market. As interest rates change, shifts in stablecoin demand and reserve allocations may create spillovers worth monitoring. Circle’s de-pegging during the Silicon Valley Bank run illustrates how quickly such spillovers can trigger instability.

Tax Questions

Beginning with the 2025 tax year, brokers must report digital asset sales and exchanges on the new Form 1099-DA. Third-party reporting is meant to strengthen compliance, but the regime begins with two notable gaps.

First, tracking cost basis is especially challenging. Taxpayers must now calculate gains and losses on a wallet-by-wallet basis (rather than the pooled basis under the universal method) and apply permitted lot-identification rules. Because crypto assets frequently move across platforms, reconstructing historical basis is difficult and brokers may lack the information needed to produce compliant forms. Brokers won’t report basis in 2025 and may do so in later years only when they have complete acquisition data.

Second, DeFi will remain largely outside the reporting framework. Common on-chain activities, including wrapping, liquidity-pool transactions, staking, and lending, aren’t covered by the broker reporting rules. Activity in non-custodial wallets is likewise out of scope. As a result, much taxable DeFi income won’t appear on a 1099-DA, even when economically meaningful. De minimis thresholds ($10,000 for qualifying stablecoins and $600 for specified NFTs) further limit reportable transactions.

These gaps mean taxpayers will continue to bear primary responsibility for tracking cost basis, monitoring on-chain activity, and reporting all taxable events, regardless of whether a form is issued. 2026 will be the first real test of whether the 1099 reporting regime provides the broker-taxpayer reconciliation needed to strengthen compliance.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law and Bloomberg Tax, or its owners.

Author Information

Vivian Fang is the Sznewajs Family Chair in Finance at the Kelley School of Business, Indiana University. She has been teaching and researching cryptocurrencies since 2018.

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