SEC Chairman Paul Atkins Commits to Establishing Clear Regulations for Digital Asset Trading, Custody, and Issuance, Ending the "Enforce First, Regulate Later" Model.
The Chairman of the U.S. Securities and Exchange Commission (SEC) Paul S. Atkins has prioritized developing a comprehensive legal framework for the crypto market in his hearing before the Senate Budget Allocation Subcommittee on June 3. Speaking in Washington D.C., Mr. Atkins emphasized the necessity of establishing a structured legal foundation for the rapidly developing digital asset sector.
"One of the top priorities in my chairmanship will be developing a rational legal framework for the crypto asset market," Mr. Atkins stated. The SEC Chairman affirmed that he will focus on establishing clear rules for three core areas: issuance, custody, and digital asset trading, while continuing to prevent legal violations.
Mr. Atkins warned about the risks of lacking a clear legal framework, emphasizing that "the absence of a legal framework is also an invitation for fraud." This perspective reflects the SEC's strategic shift from a strictly enforcement approach to proactively building regulations to protect investors and encourage innovation.
Crypto Task Force Leads Policy Reform
To realize this vision, the SEC has established a Crypto Task Force under the leadership of Commissioner Hester Peirce. The task force has organized four public roundtables focusing on critical crypto policy issues, including securities definitions, trading oversight, custody, and tokenization.
The upcoming fifth roundtable will focus on decentralized finance (DeFi), reflecting the increasingly important role of this sector in the global market. Chairman Atkins praised Commissioner Peirce as a "principle defender continuously striving for rational policy", while confirming that the Committee's work must balance encouraging innovation and maintaining law enforcement roles.
This initiative aims to end the fragmented and passive approach to crypto oversight, which was considered a barrier to innovation and effective investor protection. Instead, the SEC will apply a systematic and transparent regulatory method.
Mr. Atkins concluded the hearing with a commitment to regulation reform based on transparency and proper legal procedures. The SEC Chairman rejected the criticized "enforce first, regulate later" model, affirming that "policy formulation will be conducted through a rule-making process with public notice and consultation, not through enforcement actions."
According to the new approach, the SEC will leverage its existing authority to establish appropriate standards for market participants. The Committee's enforcement method will return to its original purpose: overseeing and addressing violations of established legal obligations, with a special focus on fraud and manipulation cases.
