TLDR
- SEC Chairman Paul Atkins launched “Project Crypto” to modernize securities rules for digital assets and establish clear regulations
- Atkins declared “most crypto assets are not securities,” reversing previous SEC stance under Gary Gensler
- The initiative allows single licenses for multiple asset classes and creates exemptions for early-stage crypto projects
- Self-custody rights will be protected and “super-apps” offering multiple services under one license will be permitted
- The CFTC will have sole authority over spot crypto markets while SEC and CFTC share joint oversight responsibilities
SEC Chairman Paul Atkins announced “Project Crypto” on Thursday, a comprehensive initiative aimed at modernizing the agency’s approach to digital asset regulation. The program represents a major shift in the SEC’s stance toward cryptocurrency oversight.
Thank you, @A1Policy, for hosting me today to discuss “Project Crypto,” which will be the SEC’s north star in aiding the President in his efforts to make America the “crypto capital of the world.”
Thread 🧵⬇️
— Paul Atkins (@SECPaulSAtkins) July 31, 2025
Speaking at the America First Policy Institute, Atkins outlined the initiative as a response to recommendations from the President’s Working Group on Digital Assets. The project seeks to create clear guidelines for crypto asset distributions, custody, and trading.
Atkins has directed commission staff to draft simple rules for public comment in the coming months. The SEC will also consider using interpretative and exemptive authorities to prevent outdated regulations from stifling innovation.
The new chairman made a clear break from his predecessor’s approach. “Despite what the SEC has said in the past, most crypto assets are not securities,” Atkins stated.
This reversal directly contradicts former Chairman Gary Gensler’s position that the vast majority of cryptocurrencies were likely securities. The confusion over the Howey test had led many innovators to treat all crypto assets as securities out of caution.
Regulatory Framework Changes
Under the new framework, the SEC and Commodity Futures Trading Commission will share joint oversight of the crypto industry. The CFTC will have sole authority over spot crypto markets, establishing clearer jurisdictional boundaries.
Atkins proposed easing licensing requirements to allow brokerages to offer multiple asset classes under a single license. This approach would enable “super-apps” offering various products and services under one roof.
The initiative includes creating exemptions and grace periods for early-stage crypto projects, initial coin offerings, and decentralized software. These measures aim to provide room for innovation without crushing projects under litigation threats.
Self-Custody and Developer Protections
The SEC chair emphasized protecting the right to self-custody digital assets. He expressed strong support for people’s ability to use self-custodial digital wallets and participate in on-chain activities like staking.
For registered entities like broker-dealers and investment advisers, additional regulatory requirements will apply when holding assets on behalf of clients. However, the framework aims to balance oversight with innovation opportunities.
Atkins also defended software developers, calling for protection of “pure publishers of software code.” This stance comes during the criminal trial of Tornado Cash developer Roman Storm.
Market Structure Improvements
The new rules will allow broker-dealers with alternative trading systems to offer trading in multiple asset types. Platforms could trade non-security crypto assets alongside crypto asset securities and traditional securities.
This unified approach would eliminate the need for fifty-plus state licenses or multiple federal licenses. The change aims to reduce regulatory burden while maintaining appropriate oversight.
Even when projects receive securities labels, Atkins argued this should not be treated as a “scarlet letter.” He has asked staff to propose purpose-fit disclosures and exemptions for initial coin offerings, airdrops, and network rewards.
The initiative also includes establishing rational rules for intermediaries operating on-chain software systems. Clear distinctions will be drawn between intermediated and disintermediated activities.
Since taking office, Atkins has already shifted the SEC’s approach by ending regulation by enforcement and approving several crypto ETF applications. In May, the agency clarified that staking income does not qualify as securities transactions.
The project aims to reshore crypto businesses that left the United States during the previous administration’s enforcement actions. Atkins referenced Trump’s goal to establish a “golden age” for digital assets in America.
