Latest statement from SEC Chair on the regulation of encryption assets: Commitment to end "enforcement regulation" and strengthen the U.S. leadership in Crypto.

SEC Chairman Paul Atkins has called for a comprehensive modernization of U.S. crypto asset policy and outlined a three-part strategy for reforming the regulation of issuance, custody, and trading.

On May 12, during a keynote speech at the latest roundtable meeting of the SEC's Crypto Assets Special Working Group, Atkins made the above statement. This meeting discussed the potential of tokenization and its upgrade of capital markets.

Atkins compares the transformation of securities to blockchain to the digital revolution in the music industry, believing that "on-chain" assets could fundamentally change capital markets in the same way that MP3s reshaped audio issuance.

Under Atkins' leadership, the SEC's top priority is to tailor a "reasonable regulatory framework" for the digital asset market, breaking free from the unpredictable enforcement patterns of recent years that have hindered innovation.

He promised that policy-making in the future will be conducted through formal channels rather than taking ad hoc actions, and reiterated his recent statements.

Atkins said: "The SEC has entered a new phase."

comprehensive reform plan

Atkins has set an ambitious reform agenda focused on promoting regulated Crypto asset issuance, expanding legitimate custody options, and modernizing the trading framework.

He pointed out that only a few projects successfully registered their issuance products through the SEC's traditional channels, and noted that outdated disclosure forms and legal uncertainties are the main obstacles.

To address this issue, regulators will consider establishing more suitable exemption provisions, safe harbor rules, and disclosure guidelines for digital native assets. He emphasized that the temporary employee guidelines are only temporary and that a complete set of rules needs to be developed by the committee to establish enduring standards.

In terms of custody, Atkins supports the repeal of the Employee Accounting Bulletin No. 121, which had imposed restrictive measures on the holding of crypto assets. He called for a broader clarification of the qualifications for 'qualified custodians' and stated that custody rules should evolve to reflect self-custody solutions and emerging best practices in the industry.

In terms of trading, Atkins stated support for allowing brokers and proprietary traders to provide comprehensive services including both Crypto assets and non-Crypto assets on a unified platform. He also suggested the possibility of conditional exemption relief to allow the launch of new products that may not yet comply with existing rules.

Consolidate the United States' leadership position in the Crypto field

Atkins echoed President Donald Trump's call to make the United States the "global Crypto capital" and warned that if the SEC cannot adapt to the changing landscape, innovation will flow overseas.

He praised the co-chairs of the newly established Crypto Assets Special Task Force, Mark Uyeda and Commissioner Hester Peirce, for their efforts to break down internal barriers and expedite the issuance of guidance documents across the agency.

In his speech, Atkins emphasized the necessity of establishing rules that can both protect investors and support innovation. He stressed that combating fraud remains a top priority, but the SEC's enforcement approach will return to its "original intent", which is to regulate violations of defined obligations rather than making policy through enforcement.

The SEC is expected to continue advancing additional rule-making, staff guidance, and inter-agency coordination in the coming months, striving to make the United States a leader in the tokenized financial infrastructure sector.