Chair of the U.S. SEC: Will Draft Rule Proposals Related to Cryptocurrency, No Longer Fearful of Innovation in the Crypto Sector

Paul Atkins, Chairman of the SEC, stated at an SEC speech that "the crypto market has been in the SEC's regulatory gray area for years. Initially, the SEC adopted what I call an 'ostrich policy'—perhaps hoping the crypto industry would disappear on its own. Later, the policy shifted to an enforcement-style regulation of 'shoot first, ask questions later.' The so-called 'welcome to talk' slogan often actually means 'welcome to receive a subpoena.' This is a dilemma for market participants. Such an environment cannot build trust. The real message being sent is: 'You're on your own.' I have recently instructed the Division of Corporation Finance to maintain transparent communication with the public. When regulators can have open dialogues with the industry, market participants can act more flexibly and allocate capital more effectively to productive uses. Today marks a new beginning for the SEC. I have instructed the policy staff to begin drafting rule proposals related to cryptocurrency. Meanwhile, staff are still 'clearing obstacles' through departmental-level statements. I hope the Commission will allow SEC-registered institutions to simultaneously custody and trade both securities and non-securities assets on one platform. This will help reduce investor costs and allow non-securities trading to quickly enter a federally regulated environment. In response to innovation trends and the progress of the crypto task force, we have applied to Congress for a budget reallocation to integrate the functions of the SEC's 'Strategic Hub for Innovation and Financial Technology (FinHub)' into other parts of the agency."