U.S. Crypto Leadership Advocated: New SEC Head Paul Atkins Pushes for Clarified Regulations to Bolster Global Crypto Influence
Fresh Cut: SEC's New Crypto Crusader, Paul Atkins, Gears Up for Modern Regulation
Paul Atkins, the fresh SEC chair, is steering us through uncharted waters of crypto regulation. In a recent Crypto Task Force Roundtable, he detailed his ambitious plan to bring outdated rules face to face with innovation, protecting investors while keeping the U.S. ahead in the global crypto race.
Insight* Paul Atkins has set his sights on modernizing crypto asset regulations for trading, issuance, and custody.* The Commission may introduce new guidelines, exemptions, and safe harbors for crypto projects.* Atkins wants to update custody rules to encompass self-custody options for funds and advisers.
"We've gotta keep up with that on-chain tech," Atkins said, emphasizing the need to adapt to blockchain technology. He argues that the current rules, written for traditional securities, are inadequate for this new digital frontier.
"If we wanna be the 'crypto capital of the planet' like President Trump imagines, the Commission's got to keep up with innovation," Atkins stated.
In order to do that, he's asked SEC staff to draft fresh guidance for issuing crypto assets that could be deemed securities or involve investment contracts. This may lead to new exemptions, safe harbors, or registration alternatives, opening up legal avenues for crypto projects.
The Self-Custody Shuffle
Atkins highlighted the way funds and advisers manage crypto assets as another area that needs a shake-up. Current SEC rules define what qualifies as a "qualified custodian," but Atkins believes they may not be suitable for the crypto market.
He believes updates are necessary to accommodate self-custody where technology offers better asset protection. He also stressed the importance of clear exceptions to qualified custody requirements for common crypto practices.
"It's important to provide clarity on the types of custodians that qualify as a 'qualified custodian' under the Advisers Act and Investment Company Act," Atkins explained. He wants to ensure that advisers have the flexibility they need, while maintaining security standards.
Deal with the Deals
Atkins also supports modernizing broker-dealers' operations. He pointed out that, under current law, they can offer trading for both securities and non-securities, but practical limitations exist due to outdated frameworks.
"Nothing in the federal securities laws prohibits registered broker-dealers with an alternative trading system from facilitating trading in non-securities," he said. He specifically mentioned trading pairs between securities and crypto tokens that may not qualify as securities.
Atkins directed SEC staff to revise the alternative trading system (ATS) rules, making room for crypto-focused platforms that offer both types of assets through a single interface.
A Regulatory Crypto Haven
Atkins' vision is to create a rational and clear regulatory path for crypto businesses in the U.S. His approach emphasizes flexibility, practical safeguards, and adapting to the unique aspects of crypto.
"We're committed to developing a balanced regulatory framework for crypto asset markets that establishes clear rules of the road... while continuing to deter bad actors from breaking the law," Atkins said.
Atkins' leadership may bring a wave of changes to how crypto companies launch tokens, store assets, and operate platforms, making the U.S. more competitive in the evolving crypto universe.
Insight* Atkins plans to establish a comprehensive regulatory framework for the issuance, custody, and trading of crypto assets.* His approach focuses on guidelines for assets subject to an investment contract.* The NYSEcrypto ETF has been pushed back due to regulatory uncertainty.
"Paul Atkins' modernization plans for crypto asset regulations extend to business operations, such as trading, issuance, and custody. This could lead to the introduction of new guidelines, exemptions, and safe harbors for crypto projects."
"In his bid to adapt to the digital frontier, Atkins is advocating for changes in broker-dealers' operations, aiming to remove practical limitations and facilitate trading of both securities and non-securities, like crypto tokens, through a single interface."
