SEC chair suggests 'huge benefits' in agency's third crypto roundtable

The new SEC Chair Paul Atkins, in his first public appearance during the agency’s third crypto roundtable, emphasized the potential for blockchain technology to deliver significant advantages, including improved efficiency, cost reduction, transparency, and risk mitigation in financial markets.

He criticized the previous SEC leadership under Gary Gensler for fostering regulatory uncertainty and stifling innovation, pledging to establish a "rational, fit-for-purpose framework" for crypto assets.

Atkins signaled a departure from the SEC’s enforcement-heavy approach, aiming instead for clearer rules to reduce market uncertainty.

The roundtable, titled “Know Your Custodian,” addressed custody challenges, with future discussions planned on tokenization (May) and decentralized finance (June).

Commissioner Hester Peirce, praised by Atkins, will lead efforts to craft crypto-friendly regulations, while Democratic Commissioner Caroline Crenshaw voiced concerns about weakening investor protections.

Atkins stressed collaboration with Congress and the Trump administration to position the U.S. as a leader in crypto innovation. The SEC’s crypto task force is actively engaging industry participants to inform policy decisions.

The new SEC framework could significantly reshape the crypto market through regulatory clarity, innovation incentives, and market dynamics.

The framework aims to define registration requirements and disclosure rules, resolving ambiguities that previously led to enforcement-heavy regulation.

Establishing criteria to determine whether crypto assets qualify as securities could reduce legal risks for issuers and exchanges.

By shifting from enforcement to collaborative rulemaking, the SEC may foster blockchain-based financial products (e.g., tokenized assets) and DeFi solutions.

Regulatory legitimacy could draw traditional investors wary of past legal uncertainties.

While enforcement may become more targeted, the SEC will likely retain anti-manipulation measures to curb scams like pump-and-dump schemes.

New rules could mandate stricter safeguards for custodians and exchanges to prevent hacks.

The SEC’s focus on custodial standards (e.g., "Know Your Custodian" roundtable) may drive demand for compliant storage providers.

The Trump administration’s pro-crypto stance, combined with industry-backed legislative efforts, could accelerate regulatory approvals.

However, Commissioner Caroline Crenshaw warns that relaxed enforcement could weaken investor protections.

Initial clarity might trigger short-term price swings as projects adjust to compliance costs or registration hurdles.

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