New Vision for Cryptocurrency Regulation
In a transformative announcement on Monday, Paul Atkins, the chair of the Securities and Exchange Commission (SEC), laid out a new vision for the agency’s regulation of cryptocurrencies, emphasizing a shift in strategy from previous administrations. During the SEC’s fourth cryptocurrency roundtable, Atkins, who was appointed by former President Trump, articulated his commitment to revising how digital assets are governed, specifically focusing on issuance and custody processes.
“We are entering a new era at the SEC,” stated Atkins.
He provided assurances that the agency will move away from reactive enforcement measures, favoring a proactive stance that utilizes its current rulemaking and exemption powers to create suitable standards for market participants instead.
Critique of Previous Regulatory Approaches
Atkins expressed discontent with the past regulatory stance under Jay Clayton, criticizing it as an “ostrich policy” that seemed to avoid engaging with the complexities of cryptocurrency. He highlighted a lack of meaningful communication with businesses seeking compliance, noting that the SEC had not adapted its registration processes to accommodate the rapidly evolving digital asset landscape.
“There was an illusion of openness; it often felt insincere given that the agency had not updated the necessary forms and protocols for new technologies,” he remarked.
Proposed Changes and Future Directions
Furthermore, Atkins signaled that the SEC might propose revisions to current custody regulations, potentially allowing financial advisers and funds to manage their own assets under certain conditions. He also mentioned changes to the framework governing Special Purpose Broker-Dealers, hinting that the agency is willing to explore possibilities of granting exemptions for firms looking to introduce innovative products that fall outside existing Commission rules.
“I am keen to investigate whether there are paths for conditional relief that could help both registrants and non-registrants in launching new services that current regulations do not fully accommodate,” he added.
Overall, Atkins’s remarks indicate a significant pivot towards a more welcoming stance for cryptocurrency within the regulatory framework of the SEC.
