tl;dr
SEC Chairman Paul Atkins, speaking at the agency’s fifth cryptocurrency roundtable, emphasized that the ability to hold crypto assets without intermediaries aligns with core American values of private property and open markets. He described blockchains as decentralized peer-to-peer ledgers and criti...
SEC Chairman Paul Atkins delivered a compelling message at the agency’s fifth cryptocurrency roundtable, championing the preservation of self-custody in decentralized finance (DeFi). He emphasized that Americans’ right to hold crypto assets without intermediaries is fundamental to the nation’s values of private property and open markets. Atkins defined blockchains as decentralized, peer-to-peer ledgers where network participants validate transactions in a competitive fee market, reinforcing the importance of maintaining this autonomous framework.
Atkins criticized previous regulatory measures that mischaracterized mining, validating, and staking activities as securities functions, noting these approaches discouraged participation and imposed undue burdens. He praised clarifications that staking does not constitute securities activity but called for formal rulemaking rather than informal guidance to solidify regulatory clarity. He warned against forced intermediation, highlighting it introduces extra costs and curtails functionalities like staking, and argued that merely developing wallet software should not trigger securities obligations.
Proposing a forward-looking roadmap, Atkins advocated for new regulations grounded in congressional authority. He supported amendments enabling intermediaries to leverage blockchains for settlement and clearing, aiming to reduce friction and boost liquidity in financial markets. To foster innovation, he directed SEC staff to create an “innovation exemption” to allow conditional relief for firms experimenting with on-chain products, facilitating rapid advancement within a structured legal framework.
Stressing the need for transparency and stability, Atkins urged the SEC to adopt formal notice-and-comment rulemaking procedures to integrate self-custody and DeFi into the existing securities laws without sacrificing investor protections. He pointed out that during market turbulence, robust on-chain protocols continued functioning while many centralized platforms faltered. Atkins concluded that adopting clear, durable policies will enable DeFi to thrive responsibly within the broader securities framework, preserving the core American values at the heart of this financial revolution.