Key Takeaways
- Atkins said the SEC will respect the right of investors to self-custody their property, calling it “a core American value”
- Project Crypto directs SEC staff to develop formal guidance covering the distribution, trading, and custody of crypto assets.
The U.S. Securities and Exchange Commission is embarking on its most ambitious digital finance initiative to date. SEC Chair Paul S. Atkins on Tuesday announced Project Crypto, a plan to overhaul how the agency regulates digital assets and to establish clear rules for crypto markets in the United States.
Project Crypto directs SEC staff to develop formal guidance covering the distribution, trading, and custody of crypto assets. The initiative will also explore temporary exemptions and relief mechanisms to give market participants flexibility during the transition to a modernized framework.
Atkins emphasized that most tokens circulating in the market “are not securities” and that the SEC intends to help the industry distinguish between securities and non-securities in the digital asset space.
Custody standards are a central focus of the initiative. Atkins said the SEC will respect the right of investors to self-custody their property, calling it “a core American value,” while recognizing that many market participants will still rely on registered intermediaries for safekeeping of digital assets.
In a major structural shift, Project Crypto is also aimed at enabling multi-service “super-apps”—single-license platforms where broker-dealers could trade both securities and non-security crypto assets, while offering services such as lending and staking under one regulatory roof. According to Atkins, these changes are designed to eliminate duplicative licensing barriers and encourage innovation and market competition.
The announcement follows a report by the President’s Working Group on Digital Assets, which Atkins called the “blueprint” for the SEC’s new approach. He said many of the agency’s rules date back to an era long before blockchain or on-chain markets existed.
“Many of the Commission’s legacy rules and regulations do not make sense in the twenty-first century — let alone for on-chain markets,” Atkins said. “The Commission must revamp its rulebook so that regulatory moats do not hinder progress and competition — from both new entrants and incumbents — to the detriment of Main Street.”
The SEC said the next steps will include publishing draft rules, soliciting industry and public feedback, and coordinating with other federal regulators to ensure that Project Crypto shapes a cohesive, forward-looking framework for U.S. digital asset markets.
