SEC’s Atkins: ‘Most Crypto Assets Are Not Securities’ Under Bold New Vision
SEC Chairman Paul Atkins announced “Project Crypto,” a commission-wide initiative to modernize securities regulations for crypto assets. This initiative, driven by President Trump’s recommendations, aims to create a “golden age” for digital assets in the U.S. A key aspect is clarifying the regulatory status of cryptocurrencies. Atkins directly contradicted his predecessor, Gary Gensler, stating that most crypto assets are not securities, although confusion surrounding the Howey test has led to many being treated as such. Project Crypto will focus on developing clear guidelines to determine whether a crypto asset qualifies as a security. Even those classified as securities won’t automatically face harsh penalties; Atkins plans to propose tailored disclosures, exemptions, and safe harbors for ICOs, airdrops, and network rewards.
The project aims to reverse the effects of previous administrations’ restrictive policies, bringing back crypto businesses that left the U.S. A core principle is supporting individual self-custody of crypto assets, while acknowledging that some investors will rely on regulated entities. Atkins also advocates for “super-apps,” allowing multiple services (trading various assets, staking, lending) under a single license, simplifying regulatory compliance. This contrasts with Gensler’s criticism of firms offering too many intertwined services. The initiative will also address the regulatory treatment of software developers, aiming to protect those creating code while establishing clear rules for intermediaries operating on-chain systems. This is particularly relevant following the recent Tornado Cash developer trial.
While Congress is working on broader crypto legislation, potentially shifting responsibilities to the Commodity Futures Trading Commission, Project Crypto will immediately tackle crucial regulatory questions. The initiative’s success will depend on balancing innovation with consumer protection and clarifying the often-murky legal landscape surrounding crypto assets. Atkins’ approach emphasizes a more lenient and pro-innovation regulatory framework, sharply diverging from the previous SEC’s stricter stance.
