SEC Signals Policy Shift: Atkins Promises Clearer Crypto Regulations

SEC Signals Policy Shift: Atkins Promises Clearer Crypto Regulations

Rulemaking through public comment to replace enforcement-first strategy

Crypto Enforcement Era Winds Down at SEC

The U.S. Securities and Exchange Commission (SEC) is preparing to reshape its approach to cryptocurrency regulation, moving away from courtroom battles and toward public engagement, according to SEC Chair Paul Atkins.

In a testimony before the Senate Appropriations Subcommittee on Financial Services on June 3, Atkins declared that the agency will rely on “notice and comment” rulemaking, rather than continue the practice of what critics have called “regulation by enforcement.”

“The commission will utilize its existing authorities to set fit-for-purpose standards for market participants,” Atkins said.

This marks a significant break from the controversial policies of former SEC Chair Gary Gensler, under whom the agency pursued crypto regulation largely through lawsuits and legal settlements.

Framework, Not Friction: A New Crypto Agenda

Atkins, who previously lobbied on behalf of digital asset interests, emphasized the need to establish a “rational regulatory framework for crypto assets”. He outlined his vision for the SEC’s future role:

• Create clear rules of the road for crypto issuance, custody, and trading.

• Reinforce investor protections and anti-fraud mechanisms.

• Ensure regulations support industry innovation while curbing abuse.

“Clear rules of the road are necessary for investor protection against fraud,” Atkins told lawmakers.
“Not the least to help them identify scams that do not comport with the law.”

Atkins also clarified that enforcement under his leadership will focus on violations of established rules—not serve as the primary method of policy creation.

SEC’s Crypto Task Force to Lead Rule Drafting

When pressed by Senator Chris Coons about whether he supports allowing crypto exchanges to handle both traditional securities and digital tokens, Atkins declined to give a direct answer. Instead, he pointed to the SEC’s Crypto Task Force, which is currently drafting industry-specific rules that aim to balance compliance with innovation.

Atkins confirmed that the Task Force’s first report is expected within the next few months.

Launched on January 21 by acting chair Mark Uyeda, the Crypto Task Force was mandated to build a practical and adaptable crypto regulatory structure.

FinHub Faces Shutdown as Innovation Goes Mainstream

In a notable development, Atkins revealed he has requested congressional approval to disband the SEC’s Strategic Hub for Innovation and Financial Technology (FinHub). Established in 2018 to foster fintech initiatives, FinHub is no longer viewed as necessary under Atkins’ broader strategy.

“Innovation should be ingrained into the culture SEC-wide,” he said.
“Not limited to a relatively small office.”

Atkins argues that the functions of FinHub are now being integrated across the agency, aligning with his goal to normalize crypto oversight within the broader financial system.

Regulatory Tone Softens Post-Gensler

Since Gensler’s resignation on January 20, the SEC has begun quietly reversing course:

• Dismissed several long-running enforcement actions against crypto firms.

• Issued guidance clarifying that common staking practices do not violate securities laws.

• Offered new interpretations of how federal securities laws apply to digital assets.

These moves suggest a measured pivot toward rules over reaction—one that could define the SEC’s regulatory posture for years to come.