The SEC’s new chair is leading a significant shift towards crypto innovation, vowing to provide much-needed regulatory clarity to facilitate blockchain transformation.
SEC Chair Paul Atkins made his inaugural address since being sworn in at the third Crypto Task Force roundtable on April 25 in Washington, D.C. Thanking his colleagues and SEC staff for their warm reception, Atkins reaffirmed his key priorities, saying:
I am eager to tackle long festering issues, such as regulatory treatment of digital assets and distributed ledger technologies.
Atkins lauded Commissioner Hester Peirce’s leadership on digital asset policy, stating, “Commissioner Peirce is the right person to develop a rational regulatory framework for crypto asset markets.” Peirce heads the Crypto Task Force, guiding its initiatives and regulatory strategy for digital assets. He also commended the panelists for their expertise and dedication to helping the agency craft more effective regulations.
The transformative potential of blockchain innovation was emphasized by Atkins, with improvements to the financial system being outlined. Significant benefits were projected by him, noting, “Huge gains in efficiency, cost savings, transparency, and risk reduction are expected from this market advancement.” Additional remarks were made by the new SEC chair:
Market participants engaging with this technology deserve clear regulatory rules of the road. Innovation has been stifled for the last several years due to market and regulatory uncertainty that unfortunately the SEC has fostered.
Looking to the future, the importance of cooperative initiatives across government was emphasized by him, stating: “Engagement with market participants will be pursued, and collaboration with colleagues in President Trump’s administration and Congress will be undertaken to build a rational, purpose-fit regulatory framework for crypto assets.”
Significant attention was given during the roundtable to the practical challenges encountered by SEC registrants when attempting to custody digital assets under existing federal securities regulations. Participants were invited by Atkins to evaluate whether revisions to the custody requirements under the Exchange Act, Advisers Act, or Investment Company Act should be considered to address the unique characteristics of crypto assets. Questions were raised by him regarding the continued viability of the “special purpose broker-dealer” model or whether a new broker-dealer structure specifically for crypto assets ought to be developed. Drawing upon signals observed in the marketplace, it was acknowledged by Atkins that the “current framework badly needs attention,” and attendees were urged to assist in providing essential input for the formation of future regulations.
