SEC Chair proposes overhaul of crypto regulations to foster innovation and clarity
14th May 2025 – (New York) U.S. Securities and Exchange Commission (SEC) Chair Paul Atkins has announced a comprehensive initiative to redefine the regulatory landscape for digital assets, emphasising clearer frameworks for issuance, custody, and trading. Speaking at a crypto roundtable on 12th May, Atkins criticised the SEC’s past approach to cryptocurrency as inconsistent and adversarial, pledging to establish pragmatic, innovation-friendly policies.
On the topic of crypto asset issuance, Atkins acknowledged that regulatory uncertainty has discouraged firms from utilising compliant mechanisms such as registered offerings or Regulation A. He highlighted the need for new pathways to encourage domestic crypto projects, stating:
“The Commission must consider additional guidance, registration exemptions, and safe harbours to enable crypto asset issuances within the United States. Our broad discretion under the securities acts allows us to accommodate the industry, and I intend to deliver.”
Atkins further noted that while some interpretive guidance exists, formal Commission action is essential to create a sustainable environment for digital asset offerings.
Addressing custody, Atkins revealed his support for expanding options for managing crypto assets, including self-custody. He pointed to the removal of Staff Accounting Bulletin No. 121 as a key step towards enabling more streamlined custodial services. He clarified that broker-dealers are already permitted to act as custodians for both security and non-security crypto assets, but regulatory clarity is needed:
“We must explore new rules to legitimise modern custody methods and ensure compliance with customer protection and net capital requirements.”
On trading, Atkins advocated for greater flexibility to meet market demands, criticising prior Commissions for restricting innovation. He suggested revisiting alternative trading system regulations and tailoring them for the crypto market. To retain technological leadership, Atkins proposed conditional exemptions for firms introducing blockchain-based products incompatible with existing rules. He warned against regulatory rigidity driving innovation offshore, stating:
“The Commission must ensure that securities market participants are not forced to leave the U.S. to develop blockchain technologies. Conditional exemptive relief could allow for responsible innovation while maintaining investor protections.”