- SEC Chair Paul Atkins pledges to build a “fit-for-purpose” framework for crypto assets.
- Industry leaders welcome the move, highlighting urgent need for updated custody rules.
What happened: SEC shifts to crypto innovation
On just his fourth day in office, newly appointed Securities and Exchange Commission (SEC) Chair Paul Atkins outlined a pro-innovation stance on cryptocurrency regulation, marking a major policy pivot from the Biden-era focus on enforcement. Speaking at the SEC’s third Crypto Task Force roundtable on 25 April, Atkins criticised previous regulatory approaches, claiming they stifled digital innovation.
Atkins pledged to address the “long festering issues” surrounding blockchain technology, emphasising the urgent need for clear and rational crypto regulations. He confirmed that Commissioner Hester Peirce, known as the “crypto mom” for her pro-crypto views, will lead efforts to design a new framework for digital assets. The roundtable discussion centred on a critical challenge: how broker-dealers and investment firms can safely hold custody of digital assets while remaining compliant with federal laws.
Industry leaders, including Xapo Bank CEO Seamus Rocca and Etana Custody CEO Brandon Russell, welcomed Atkins’ remarks, noting that regulatory clarity is vital to retain crypto innovation within US borders. Experts at the event highlighted that current custody rules — built for traditional finance — do not accommodate the decentralized nature of blockchain systems, urging a principles-based approach over prescriptive, technology-specific regulation.
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Why it is important
Atkins’ policy shift could be transformative for the US crypto sector. Clearer, more supportive regulation could reverse the trend of crypto innovation migrating overseas, where jurisdictions have already adapted laws to better fit digital assets.
The recognition that blockchain infrastructure eliminates the need for traditional intermediaries represents a significant departure from legacy financial models. As pointed out by Georgetown Law professor Adam Levitin, trying to apply frameworks based on physical asset custody to crypto is like fitting “a peer-to-peer system into a model built for centralised trading.”
With Commissioner Peirce’s leadership and a new focus on flexibility, the SEC aims to create a regulatory environment that fosters innovation while protecting investors — a balance industry experts have long demanded. If successful, this approach could re-establish the United States as a leader in the global crypto economy.
