Speaking before the House Financial Services Committee on Wednesday, U.S. Securities and Exchange Commission (SEC) Chairman Paul Atkins outlined plans to develop formal guidance on token classification, aligning the agency with anticipated legislation on the crypto market structure known as CLARTÉ law.
Aiming for lasting cryptographic clarity
Atkins said Lawmakers said regulatory certainty for digital assets was long overdue and promised the Commission would be ready to act once Congress finalizes the CLARITY Act. He stressed that a comprehensive federal framework would provide much-needed clarity for both investors and innovators.
While noting that the SEC staff, under Commissioner Hester Peirce’s Crypto Task Force, has offered more advice in the past year than in the previous decade, Atkins argued that lasting reform ultimately requires bipartisan legislation.
According to him, no regulatory adjustment undertaken solely by the Commission can “perpetuate” the rules as effectively as a clear text. market structure law adopted by Congress.
As lawmakers continue their work, Atkins said the SEC intends to work closely with the Commodity Futures Trading Commission (CFTC) to bridge the gap until the legislation is signed into law. He and CFTC Chairman Mike Selig plan to coordinate in a joint initiative known as Project Crypto.
As part of this effort, regulators will consider developing a token taxonomy designed to more precisely define digital assets and clarify the rules that apply to different categories.
The agencies are also considering tailored exemptions that could allow market participants to transact directly on blockchain networks, a move aimed at fostering innovation while maintaining oversight.
Review of Atkins Signal Regulations
Beyond digital assets, Atkins used his testimony to signal a broader reassessment of existing regulatory systems. He announced that he had directed SEC staff to conduct a comprehensive review of the Consolidated Audit Trail (CAT), the market surveillance system launched in November 2016.
The review will examine the following areas: governance, financing, cost-effectiveness, system design, scope, regulatory utilityand cybersecurity protection measures, also encompassing the crypto sector.
Throughout his speech, Atkins reiterated his broader philosophy on regulation. He said oversight should be intelligent, effective and carefully tailored within the SEC’s statutory authority.
He said the existing framework has sometimes made the process of going public more restrictive and costly, adding requirements that can create more friction than benefits.
Meanwhile, the market as a whole has seen a notable downtrend, with cryptocurrency prices making a strong comeback and sparking fears of a bear market. At the time of writing these lines, Bitcoin (BTC) returned to the $65,000 level after failing to surpass the $70,000 resistance level earlier in the week.
Ethereum (ETH) followed suit, mirroring BTC’s price action and currently trading at around $1,916 per token. As a result, total market capitalization has fallen to almost half of its October highs, currently valued at $2.23 trillion.
Featured image from OpenArt, chart from TradingView.com
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