SEC Considers Exemption Framework to Foster Crypto Innovation
The US securities regulator is developing an “innovation exemption” aimed at fostering the creation of additional onchain products and services, according to Securities and Exchange Commission chair Paul Atkins.
Atkins, a former crypto advocate, stated during a recent crypto roundtable hosted by the SEC’s crypto task force titled DeFi and the American Spirit that he has instructed staff to explore a conditional exemption relief framework.
Exemptions could accelerate innovation
These provisional exemptions would absolve firms from specific regulatory obligations to stimulate innovation in emerging tech sectors, provided they fulfill certain criteria.
Atkins mentioned that this initiative would expedite the market introduction of onchain products and services while the SEC staff reviews amendments to the Commission’s rules and regulations.
Source: US Securities and Exchange Commission
“An innovation exemption could help realize President Trump’s vision of making America the leading crypto hub globally by encouraging developers, entrepreneurs, and other firms willing to comply with specific conditions to innovate using onchain technologies in the United States,” he remarked.
Additionally, Atkins stated that he has requested staff to assess whether amendments to the Commission’s rules and regulations would accommodate issuers and intermediaries aiming to manage onchain financial systems.
“Most existing securities rules and regulations are based on the regulation of issuers and intermediaries, like broker-dealers, advisors, exchanges, and clearing agencies,” he noted. “The architects of these rules likely did not anticipate that self-executing software code could replace such issuers and intermediaries.”
Crypto framework is still evolving
The agency’s Crypto Task Force was initiated on January 21 by acting SEC chair Mark Uyeda, who was assigned the task of developing a viable crypto framework for the agency.
Atkins disclosed in remarks on June 3 to the Senate Appropriations Subcommittee on Financial Services that the SEC would refine its crypto policies using “notice and comment” and shift away from formulating its rules through the courts.
He had previously appeared before lawmakers on May 20 and announced that the Crypto Task Force would be issuing its first report within the next few months.
New strategy at SEC
During the recent crypto roundtable, Atkins also criticized the previous administration under former SEC Chair Gary Gensler and its methodology towards crypto.
Gensler faced significant backlash from the crypto industry for allegedly establishing policy through lawsuits and legal settlements instead of formal rulemaking.
Related: SEC charges Unicoin crypto platform over alleged $100 million fraud
Since Gensler’s resignation on January 20, the SEC has embraced a different strategy regarding crypto, dismissing longstanding enforcement actions against crypto firms.
SEC staff have also provided guidance regarding the most prevalent crypto staking activities, asserting that they do not breach securities laws, along with information concerning how federal securities laws may pertain to crypto.
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