New SEC Chairman Paul Atkins Pledges Innovation-Friendly Crypto Regulations
In a marked departure from the previous administration’s enforcement-first approach, new Securities and Exchange Commission (SEC) Chairman Paul Atkins has signaled a major shift toward innovation in crypto policy. Speaking at the agency’s third Crypto Task Force roundtable, Atkins criticized the regulatory direction taken under the Biden administration and pledged to tackle the “long festering issues” surrounding digital assets and blockchain technology.
“Innovation has been stifled for the last several years due to market and regulatory uncertainty that unfortunately the SEC has fostered,” said Atkins, who previously served two terms under former President George W. Bush. Market participants “deserve clear regulatory rules of the road,” Atkins said, adding that he will work to establish a “rational fit-for-purpose framework for crypto assets.”
The SEC roundtable centered on one of the thorniest regulatory challenges: how broker-dealers and investment firms can safely hold custody of digital assets in compliance with federal securities laws. Panelists urged a shift from outdated “physical possession” custody rules toward flexible, principles-based standards that are a better fit for blockchain technology.
“We just have a different system now with the digital asset ecosystem, and it doesn’t fit squarely within the rules that were written for a completely different system,” said Susan Gault-Brown, a partner at Allen Overy Shearman Sterling LLP. Industry leaders warned that without swift regulatory clarity, the U.S. risks losing blockchain innovation to foreign markets that have already embraced clearer crypto frameworks.
The new SEC chairman’s pro-innovation stance on cryptocurrency could encourage the growth of the digital assets market domestically rather than pushing it abroad. Atkins praised SEC Commissioner Hester Peirce, known as ‘crypto mom,’ for her “principled and tireless advocacy for common sense crypto policy” and announced that she will lead efforts to create the new framework.
As the U.S. regulatory landscape evolves, industry leaders are cautiously optimistic about the potential for clearer guidelines that could foster innovation while protecting investors.
