America’s financial markets are remarkably successful. The U.S. has less than 5% of the world’s population, yet over half of global investment capital is generated in American markets. The U.S. dollar has long been the reserve currency. With all this, one would think that regulating crypto wouldn’t be difficult.

Yet almost no one is satisfied with the current state of regulation. Efforts by regulators, legislators and market participants have met resistance from one another. Consensus remains elusive—and will remain so until the reasons for the regulatory challenge are understood.