US, China, UAE Advance Digital Asset Laws
The United States, China, and the United Arab Emirates are all advancing new regulations for digital assets. These changes have implications for insurers and InsurTech companies exploring embedded finance, parametric products, or crypto-based claims. The global regulatory momentum suggests a maturing framework for digital assets in the financial sector.
- In the U.S., the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act became law in July 2025, establishing a federal framework for stablecoins. It mandates that stablecoin issuers must maintain 1:1 reserves of high-quality liquid assets, such as cash or short-term U.S. Treasuries. - Dubai's Virtual Assets Regulatory Authority (VARA) now requires licensed virtual asset service providers, including crypto exchanges and custodians, to hold specific types of insurance. This includes coverage for professional indemnity, crime, and custody of assets to protect against risks like hacks, theft, and fraud. - China reiterated its ban on cryptocurrency-related business activities in a joint notice from eight government agencies on February 6, 2026. The notice also extended restrictions to offshore activities, including the issuance of stablecoins by Chinese entities or any pegged to the renminbi. - While banning private crypto, China is advancing its central bank digital currency (CBDC), the digital yuan (e-CNY). Starting January 1, 2026, the e-CNY will be treated as a "digital deposit," allowing commercial banks to pay interest on holdings which will be protected under the national deposit insurance system. - In a first for the region's insurance sector, Dubai Insurance launched a crypto-enabled digital wallet on January 28, 2026. Developed with Zodia Custody, it allows policyholders to pay premiums and receive claim settlements directly in digital assets, starting with Bitcoin. - A new Chinese regulatory framework issued in early 2026 replaced the previous crypto ban with a more comprehensive one, but it also created a narrow, state-controlled channel for the tokenization of real-world assets (RWA) for the first time. - U.S. legislation clarifies that stablecoins issued by a permitted entity are not classified as securities or commodities, placing them outside the direct oversight of the SEC or CFTC. Instead, entities like subsidiaries of insured banks or federally licensed nonbank issuers fall under the supervision of banking regulators.
