Key Takeaways
- The SEC’s Project Crypto aims to modernize rules and provide clearer guidelines for crypto asset classification and approvals.
- The program is designed to support President Trump’s push to make the US the global hub for crypto innovation.
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SEC Chair Paul Atkins announced Thursday the launch of Project Crypto, a sweeping Commission-wide initiative to modernize securities regulations for crypto assets.
In support of President Trump’s vision to make the US the “crypto capital of the world,” the initiative aims to establish clear rules for the distribution, custody, and trading of crypto assets, while fostering innovation through tailored exemptions and regulatory flexibility.
“Under my leadership, the SEC will not stand idly by and watch innovations develop overseas while our capital markets remain stagnant,” said Atkins in a speech at the America First Policy Institute.
The initiative follows the passage of the GENIUS Act and the release of the President’s Working Group’s (PWG) report on digital asset markets. It expands upon efforts by the SEC’s Crypto Task Force, headed by Commissioner Hester Peirce.
Key priorities of Project Crypto
Project Crypto’s purpose is to overhaul and modernize the SEC’s regulatory framework to accommodate crypto assets and on-chain markets.
The initiative sets the strategic direction for how the SEC will support innovation, clarify token classification, enable tokenized securities, and integrate decentralized systems into compliant market structures, according to Atkins.
Project Crypto will focus on several key areas, including creating clear guidelines for determining whether crypto assets are securities, developing purpose-fit disclosures and safe harbors for token distributions, modernizing custody requirements, and enabling “super-apps” that can offer multiple crypto services under a single license.
“Most crypto assets are not securities,” Atkins stated. “But confusion over the application of the ‘Howey test’ has led some innovators to prophylactically treat all crypto assets as such.”
The SEC will work with the Crypto Task Force to swiftly develop proposals implementing the PWG’s recommendations.
“Capital formation is at the heart of the SEC’s mission, yet for too long the SEC ignored market demands for choice and disincentivized crypto-based capital raising,” Atkins said.
The chairman directed SEC staff to draft “clear and simple rules of the road” for crypto asset distributions, custody, and trading for public notice and comment. The agency will consider using interpretative and exemptive authorities to prevent outdated rules from hindering innovation.
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