SEC Declares the Agency Is Rebuilding Its Approach to Crypto From the Ground Up
SEC Chairman Paul Atkins has signaled a fundamental reorientation of the agency’s relationship with the cryptocurrency industry, describing the previous administration’s approach as a major missed opportunity for the United States and pledging that the SEC will now take an actively supportive role in fostering digital asset innovation.
A Direct Rejection of the Gensler Era
Speaking at the University of Texas, Atkins was direct about his assessment of what the SEC got wrong under his predecessor Gary Gensler. The agency’s rigid stance, in Atkins’ framing, pushed crypto innovation offshore and handed regulatory leadership to other jurisdictions at a moment when the U.S. had every structural advantage to lead.
The numbers behind the shift are stark. During the Gensler era, monetary penalties against crypto firms totaled approximately $4.7 billion. Under Atkins, that figure dropped to $142 million across all of 2025. New crypto lawsuits declined by roughly 60% compared to the prior baseline. The enforcement focus itself changed, moving away from registration violations and toward fraud and direct consumer harm cases.
That reorientation has a name inside the agency. The SEC has formally moved away from regulation by enforcement, replacing it with a framework focused on defining operational standards for exchanges, broker-dealers, and digital asset issuers.
The Policy Architecture
The practical changes Atkins has overseen since taking the role are already visible across several areas.
The SEC approved WisdomTree’s 24/7 trading digital fund in February 2026, the first U.S. fund of its kind to offer instant settlement. New guidance on stablecoin capital treatment reduced the haircut on qualified stablecoin holdings to 2%, meaning broker-dealers can now count 98% of their USDC or other qualified stablecoin holdings toward net capital requirements. Regulated venues including Alternative Trading Systems can now facilitate direct trading between security tokens and non-security assets like Bitcoin, removing the previous requirement for fiat intermediaries in every transaction.
The SEC also removed cryptocurrency from its 2026 examination priorities entirely, signaling that digital assets are no longer treated as a standalone risk category requiring elevated scrutiny.
On the collaborative side, Project Crypto, a joint initiative with the CFTC, is working to modernize regulatory frameworks, clarify token classifications, and establish unified custody rules across digital asset categories. A temporary innovation exemption, expected to be formally proposed in early 2026, would allow firms to test novel business models including automated market makers under defined guardrails before full regulatory frameworks are finalized.
The Broader Goal
Atkins addressed the current market environment directly at ETHDenver, noting that the SEC’s role is not to manage daily price movements. Bitcoin trading around $67,000 or volatility in broader crypto indices is not the agency’s concern. What Atkins described as the primary objective is positioning the United States as the global crypto capital through a permanent, legislative framework, specifically naming the Clarity Act as the vehicle for achieving that outcome.
The enforcement data, the approved products, and the removed examination priority all point in the same direction. Whether the legislative piece arrives on the timeline Atkins has outlined depends on Congress, not the SEC.
The post SEC Declares the Agency Is Rebuilding Its Approach to Crypto From the Ground Up appeared first on ETHNews.
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