Key Takeaways
- The SEC’s Project Crypto aims to modernize rules and provide clearer guidelines for crypto asset classification and approvals.
- The initiative will facilitate simpler token distribution, custody, and trading rules to foster innovation in US crypto markets.
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The SEC has launched “Project Crypto,” a comprehensive initiative to modernize securities rules and regulations for crypto assets, SEC Chairman Paul Atkins announced today.
The initiative aims to help establish the US as the “crypto capital of the world” and implement recommendations from the President’s Working Group on Digital Asset Markets, Atkins said in a speech at the America First Policy Institute.
“Today, I would like the world to go on notice that under my leadership, the SEC will not stand idly by and watch innovations develop overseas while our capital markets remain stagnant,” Atkins said.
Project Crypto will focus on several key areas, including creating clear guidelines for determining whether crypto assets are securities, developing purpose-fit disclosures and safe harbors for token distributions, modernizing custody requirements, and enabling “super-apps” that can offer multiple crypto services under a single license.
“Most crypto assets are not securities,” Atkins stated. “But confusion over the application of the ‘Howey test’ has led some innovators to prophylactically treat all crypto assets as such.”
The SEC will work with the Crypto Task Force, led by Commissioner Hester Peirce, to swiftly develop proposals implementing the PWG’s recommendations. The initiative follows recent passage of the GENIUS Act, which established a regulatory framework for stablecoins.
“Capital formation is at the heart of the SEC’s mission, yet for too long the SEC ignored market demands for choice and disincentivized crypto-based capital raising,” Atkins said.
The chairman directed SEC staff to draft “clear and simple rules of the road” for crypto asset distributions, custody, and trading for public notice and comment. The agency will consider using interpretative and exemptive authorities to prevent outdated rules from hindering innovation.
This is a developing story. Please come back for further updates.
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