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05/13/2025

SEC Chair Paul Atkins Announces Sweeping Crypto Market Reform Plan: "End Regulation by Enforcement"

Washington D.C., May 12, 2025 – In an ambitious address at the SEC Crypto Asset Task Force roundtable, newly appointed Chair Paul Atkins unveiled a comprehensive reform agenda to modernize digital asset regulations and put an end to years of "regulation by enforcement" that has drawn sharp criticism from the industry. Blockchain – A Revolution Like MP3? Atkins compared the shift to blockchain-based securities to the revolution MP3 once brought to the music industry

SEC Chair Paul Atkins Announces Sweeping Crypto Market Reform Plan: "End Regulation by Enforcement"

Washington D.C., May 12, 2025 – In an ambitious address at the SEC Crypto Asset Task Force roundtable, newly appointed Chair Paul Atkins unveiled a comprehensive reform agenda to modernize digital asset regulations and put an end to years of "regulation by enforcement" that has drawn sharp criticism from the industry.

Blockchain – A Revolution Like MP3?

Atkins compared the shift to blockchain-based securities to the revolution MP3 once brought to the music industry — fundamentally changing how products are distributed and consumed. He argued that on-chain assets will play a central role in modernizing global capital markets.

"The SEC is entering a new era. We need a rational, durable regulatory framework — not stopgap guidance or ad hoc actions." – Paul Atkins

Three Pillars of Reform

Atkins' reform plan centers on three key directions:

  1. Overhauling the token issuance process
    The SEC will push for exemptions, safe harbors, and disclosure guidance tailored to digital assets. He noted that far too few projects can successfully register under current rules — rules that are simply too outdated for the realities of the market.
  2. Expanding the definition of "qualified custody"
    He advocated for repealing Staff Accounting Bulletin No. 121 — which restricts how firms can hold crypto. Atkins also called for formal recognition of self-custody models and emerging custody solutions already being used across the industry.
  3. Modernizing the digital asset trading framework
    The SEC plans to allow broker-dealers to operate on platforms that integrate both crypto and traditional assets. Temporary exemptions will also be proposed to encourage experimentation with innovative products.

Positioning the U.S. as the Global Crypto Leader

Atkins expressed alignment with President Donald Trump's vision of making the U.S. the "crypto capital of the world." He warned that without timely reform, capital and technological innovation will flee the country.

Atkins also praised the contributions of fellow SEC commissioners Mark Uyeda and Hester Peirce within the Crypto Task Force, with a shared goal of breaking down internal barriers and delivering clear guidance quickly.

Taking Aim at Outdated Regulatory Practices

Atkins stressed that under his leadership, the SEC will no longer use enforcement actions to make policy. Instead, rules will be developed openly through formal rulemaking processes to ensure transparency and support innovation.

"We will continue to crack down on fraud, but we will not use vague laws to stifle technological development. The SEC's mission is to protect investors and promote healthy markets."