Framework for understanding blockchain regulation

This article draws on a research titled, Navigating Blockchain’s Potential in Global Development: Comparing Policies Related to Tokenization of Infrastructure in the Philippines and the US, as part of a Harvard ALM degree coursework by the author.

When I began researching blockchain regulation, I expected to find clear national positions: some countries would be more supportive of innovation, others more cautious and enforcement-driven.

What emerged instead was something more structurally complex.

Blockchain regulation is not shaped by a single national stance. It is produced through the interaction of multiple institutions within the same jurisdiction, each operating under different mandates and policy priorities.

Financial regulators tend to focus on investor protection and market integrity. Central banks prioritize monetary stability and payment system modernization. Tax authorities emphasize classification and compliance enforcement. These perspectives do not converge into a single voice, but together define the effective regulatory environment in which blockchain technologies develop.

This observation led me to apply a modified version of the Institutional Entrepreneurial Orientation (IEO) framework, originally developed by Cowden and Tang (2022), which builds on the entrepreneurial orientation literature of Covin and Slevin (1989).

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The original framework evaluates organizational behavior along three dimensions: innovativeness, proactiveness, and risk-taking. Cowden and Tang extend this approach to governments, treating institutions as actors that respond to emerging technologies such as blockchain.

In my research, I further modified this framework by applying it at the agency level rather than the national level. Instead of treating countries as unified regulatory actors, I evaluated individual government agencies based on three dimensions:

• Innovativeness: the degree to which an agency engages with or enables blockchain-related development

• Proactiveness: whether the agency anticipates and shapes future industry needs rather than reacting to them

• Risk-taking: the extent to which the agency allows experimentation relative to strict enforcement of existing rules

I assessed these dimensions using observable policy behavior, including regulatory guidance, enforcement actions, official statements, and institutional initiatives over time.

This shift in unit of analysis proved important. It allowed me to see regulatory environments not as single policy positions, but as structured combinations of institutional behavior.

In other words, blockchain regulation is not a monolith. It is a configuration of agency-level orientations that interact to shape the boundaries of innovation.

When I applied this framework for understanding blockchain regulations in the United States and the Philippines, the differences were not only between countries, but within them. Each jurisdiction contained multiple institutional approaches operating in parallel, sometimes reinforcing each other and sometimes pulling in different directions.

What matters, therefore, is not only whether a country is open or cautious toward blockchain, but how innovativeness, proactiveness, and risk tolerance are distributed across its regulatory institutions.

This becomes particularly relevant in the case of infrastructure tokenization, which depends on coordination across securities regulation, payment infrastructure, taxation, and investor protection frameworks. The feasibility of implementation is shaped not only by individual policy positions, but by how aligned these institutional dimensions are across agencies.

From this perspective, blockchain regulation is better understood as a multi-layered institutional system rather than a single national stance.

And that shift in perspective is what my research ultimately contributes: a way to analyze regulatory environments through their internal institutional structure, rather than only through their external policy signals.