- SEC Chairman Paul Atkins wants to “permanentize” changes to US crypto regulations.
- He reiterated his belief that the agency should change the rules regarding securities trading to better account for tokenized alternatives.
- Atkins also said he wanted to respect the “central, fundamental principle” that drives cryptography.
Paul Atkins, chairman of the United States Securities and Exchange Commission, has embarked on a campaign to overhaul the agency’s crypto regulations.
And he doesn’t want a future administration to quickly undo his hard work.
“What’s really important to me is to sustain what we’re doing,” Atkins said, “so that whatever happens in the future, we don’t have the pendulum swing the other way, and a lot of our efforts are then washed away.”
He did not specify what steps the agency would take to try to secure the coming changes.
Atkins was speaking at the Blockchain Association’s fourth annual policy summit in Washington, DC. Other speakers included US Treasury Secretary Howard Lutnick, Comptroller of the Currency Jonathan Gould and several US lawmakers.
Atkins’ campaign, dubbed “Project Crypto,” has drawn praise from the industry since it was announced in July.
At the time, he said the “plan for crypto market primacy” would take into account the benefits and risks of “moving our markets from an off-chain to an on-chain environment.”
SEC staff were asked to develop proposals to address ongoing confusion over the regulatory status of crypto assets, make it easier for traditional financial institutions to hold cryptocurrencies on behalf of their customers, enable the creation of all-in-one financial “super apps,” and “unleash the potential of blockchain software systems in our securities markets.”
In a November speech at the Federal Reserve Bank of Philadelphia, Atkins outlined his crypto philosophy. In short, crypto assets fall into four categories: digital commodities, digital collectibles, digital tools, and tokenized securities.
Of the four, only tokenized securities should be considered securities subject to SEC regulation, Atkins said in his November speech.
Tokenized securities will be the focus of the SEC’s crypto efforts, Atkins said Tuesday. He specifically pointed out that the rules that govern securities trading were ripe for change. Such a change would be necessary to enable on-chain trading of tokenized stocks.
“All (these regulations) don’t really make sense in a token chain world,” the president said.
The project, however, has its opponents. In a letter to the SEC this month, Citadel Securities, one of the largest market makers in the United States, said easing these rules could fracture U.S. stock markets by favoring decentralized exchanges over their traditional counterparts.
Atkins also dismissed any possibility of the SEC separating traditional markets from the much smaller, but more volatile, crypto market.
“When it comes to private blockchains, walled gardens, whatever you want to call them, I think the whole philosophy behind distributed ledger technology is interoperability and freedom of movement. That’s the central, fundamental principle that we have to respect,” Atkins said.
“So let people innovate. Let the market decide what it wants to do.”
Aleks Gilbert is DL News’ DeFi correspondent based in New York. You can reach him at aleks@dlnews.com.
