The US Securities and Exchange Commission (SEC) chairman and two Commissioners have highlighted the crypto industry as one of the top priorities in the regulatory agency’s pivot toward clearer and pro-innovation oversight.
Crypto Tops SEC’s Pro-Innovation Agenda
On Thursday, SEC Chairman Paul Atkins and Commissioner Hester Peirce discussed the regulatory agency’s shift towards pro-innovation regulation and their efforts to implement US President Donald Trump’s vow to make America the “crypto capital of the world.”
In the first episode of the SEC’s official “Material Matters” podcast, Atkins outlined the crypto industry as “one area now that is really top on our list to try to get right with respect to regulation.”
Peirce, who leads the Commission’s Crypto Task Force, affirmed that the shift toward a more welcoming environment for digital assets has made developing an “understandable” regulatory framework that is “fit for purpose” significantly easier.
The commissioner considers that under the SEC’s new approach, the regulator can better address the problems the crypto industry may face and open opportunities for innovation in this sector.
“We need to have financial regulations that are open to innovators because innovation is what makes the financial markets resilient. It’s what ensures that they serve people’s actual needs,” she stated.
To make the US a country where people want to innovate, she suggested that regulators must demonstrate they are willing to work with innovators to resolve ambiguities about how the law applies to their circumstances. This approach, Peirce affirmed, will benefit US investors and markets.
And there have been a lot of ambiguities in connection with crypto, which is a new technology that does things in new ways. Having a good regulatory structure in place is going to be helpful to us (…) to identify where the bad activity is and to go after that bad activity, and not to spend our enforcement resources where our regulatory resources could have done the job.
Federal Regulation At A ‘Very Important Inflection Point’
When asked what a top priority should be to address potential risks related to crypto assets, Peirce noted that there hasn’t been a regulatory framework around spot trading. She also noted that the Commodity Futures Trading Commission (CFTC) will address that in the future.
Notably, the SEC has published detailed guidelines to provide regulatory clarity, including rules for broker-dealers and retail investors on the custody of crypto assets. A month ago, the Commission also issued joint guidelines with the CFTC that clarified how federal securities laws apply to many digital assets, confirming that most crypto assets are not securities.
The Commissioner also noted that the recent cooperation between the two sister agencies has been helpful, as they want to ensure they are not spending unnecessary resources to address the same problem.
As reported by Bitcoinist, the SEC and the CFTC partnered in January to bring “coordination, coherence, and a unified approach” to the federal regulation of the industry through their joint Project Crypto initiative.
The agencies outlined their plan to clarify jurisdictional boundaries, remove redundant compliance requirements, and reduce regulatory fragmentation through their collaboration.
“I think having the close cooperation with the CFTC ensures that we’re monitoring markets which are very interrelated with one another, and then thinking about where it makes sense for products to be regulated, who the primary regulators should be,” the Commissioner argued.
During the podcast episode, Atkins and Peirce also noted that allocating the authority of the two agencies will help bring clearer regulation. This is expected to be addressed by Congress in the long-awaited crypto market structure bill, also known as the CLARITY Act.
The SEC chairman affirmed that “this is a very important inflection point, I think, in the American markets,” concluding that there are “a lot of opportunities ahead of us. So, it really is a historic time.”
