# Introduction

On April 22, 2025, Paul S. Atkins was sworn in as the 34th Chairman of the U.S. Securities and Exchange Commission (SEC), sending an unprecedented policy-friendly signal to the crypto industry. In his inaugural speech, he clearly stated that the "top priority" of his term would be to establish a clear and reasonable regulatory framework for digital assets, helping the U.S. become the most innovative and attractive hub for crypto asset development globally.

In stark contrast to the "high-pressure enforcement" approach under former Chairman Gary Gensler, Atkins is seen as the "crypto dad," advocating for "common-sense regulation" and "supporting innovation." To date, Atkins has expressed clear policy positions on various areas, including crypto assets, DeFi, stablecoins, PoW, and PoS tokens, in multiple public forums. The SEC has also released a series of clarifying statements to actively delineate the applicability of securities laws, aiming to enhance industry confidence through rule transparency. Meanwhile, a series of high-profile enforcement cases have been withdrawn or settled, sending an important signal of regulatory flexibility and indicating that the SEC is transitioning from "enforcement-led" to "rules-first."

Since Atkins took office, major investment institutions have raised their expectations for allocations in the U.S. compliant market, and the DeFi protocol and token markets have reignited growth momentum. This report will summarize the important policy signals from Atkins to date, delve into his regulatory thinking and policy direction, and look ahead to the potential systemic impacts on the industry.

# Analysis of Policy Differences Between Two Chairmen

In stark contrast to the high-pressure atmosphere of the previous administration, Atkins is transforming the SEC's stance from enforcer to guide and rule-maker.

• Differences in Regulatory Philosophy: During Gary Gensler's tenure at the SEC, a strong enforcement and "regulate first, innovate later" conservative approach was adopted towards crypto assets. Under Gensler, the SEC expanded its crypto enforcement division and launched numerous lawsuits against exchanges and issuance projects, which the industry viewed as "repressive regulation." In contrast, Atkins' philosophy is a "new paradigm," concentrating on formulating clear policies through a special Crypto task force, emphasizing the need to end the industry's long-standing "stagnation and confusion." There were virtually no new regulations tailored for crypto during Gensler's tenure, whereas Atkins has issued multiple statements clarifying the applicability of laws within two months of taking office and is pushing for new regulations. In summary, the former chairman was keen on using case enforcement as a deterrent, while the current chairman prefers to set behavioral boundaries through rule publication.

• Differences in Enforcement Methods and Attitudes: Gensler emphasized high-pressure deterrence, strengthening regulatory authority through enforcement, even pursuing "non-compliance" responsibilities for projects that were not fraudulent; Atkins focuses more on prudent restraint, showing tolerance for technical explorations that do not involve fraud and preferring to resolve issues through negotiation. This is reflected in personnel and institutional adjustments: prior to Atkins' appointment, acting chairman Uyeda had already begun to reduce the intensity of crypto enforcement, renaming the crypto enforcement group to "Network and Emerging Technologies" and reallocating personnel to rule-making. Two Republican commissioners, Uyeda and "crypto mom" Hester Peirce, have also publicly criticized Gensler's litigation-heavy approach, advocating for new regulations to replace endless legal battles.

• Specific Policy Differences: On the standards for determining securities, Gensler insisted on using the Howey test, believing that most tokens, except Bitcoin, meet the definition of "investment contracts," even suggesting that many tokens are unregistered securities. In contrast, Atkins' camp tends to the opposite judgment: Commissioner Peirce stated in May 2025 that "most crypto assets in the current market are not securities." Atkins himself has supported a series of statements that effectively exclude PoW tokens, ordinary stablecoins, and decentralized issued tokens from securities regulation.

• Differences in Enforcement Cases: During Gensler's tenure, the SEC sued crypto projects like Ripple, Coinbase, Binance, and Kraken, attempting to establish legal precedents through court rulings. However, after Atkins took office, the SEC quickly withdrew or suspended these lawsuits, which were based on "non-compliance" without fraud, including the withdrawal of the Coinbase case, the settlement of the Ripple case, and the suspension of the Binance case, representing a significant policy turnaround.

# Atkins' Regulatory Attitude Towards the Crypto Industry

Atkins emphasizes that the crypto asset sector needs a "reasonable market regulatory framework," providing guidance for the issuance, custody, and trading of crypto assets through clear rules, rather than resorting to enforcement actions. He pointed out that securities are migrating from traditional off-chain databases to on-chain blockchain, and the SEC must keep pace with innovation, assessing whether existing regulations need adjustments to accommodate on-chain securities and other crypto assets. He stated that during his term, the SEC would "no longer rely on controversial enforcement actions," but instead use existing rule-making, interpretive, and exemption powers to set precise standards for market participants. Atkins' statements signify a major shift in the SEC's regulatory approach: from previous regulatory ambiguity and high-pressure enforcement to transparent rule guidance and a legal compliance roadmap.

1. Crypto Asset ETFs

The SEC has approved the first batch of Bitcoin spot ETFs and Ethereum spot ETFs in 2024, and since 2025, there has been a surge in applications for other crypto asset ETFs. Data shows that in the first half of 2025, at least 31 "altcoin" ETFs have been proposed, including XRP, BNB, SOL, DOGE, and even Trump's personal token TRUMP, reflecting the market's optimistic expectations for the new regulatory environment. Analysts believe the SEC is likely to approve about ten of these ETFs, ushering in a "summer of alternative coins" for compliant products.

2. Decentralized Finance

Atkins stated that "economic freedom, private property rights, and innovation—these core American values—are the inherent genes of the DeFi movement." At the "DeFi and the American Spirit" roundtable on June 9, 2025, he emphasized that outdated regulations should not stifle the transformative potential of blockchain technology, and there is "no need to automatically fear the future." He particularly pointed out that, unlike the recent failures of centralized platforms, many on-chain protocols continue to operate stably according to open-source code design during crises, demonstrating strong resilience. Atkins believes that DeFi requires a regulatory framework distinct from traditional intermediaries and cannot simply apply centralized financial regulations. He proposed exploring a conditional "innovation exemption" mechanism, allowing eligible registered or unregistered entities to quickly launch on-chain products and services, providing a legal testing space for DeFi projects before formal rules are established, which is seen as a relaxation of regulation for the entire industry.

3. Trading Platforms and Token Trading

Regarding crypto exchanges and securities trading platforms, Atkins advocates breaking past unreasonable prohibitions and allowing compliant institutions to offer a richer array of trading products based on market demand. He cited examples where some brokers wish to create "super apps" integrating services for both securities and non-securities, and current laws do not actually prohibit registered brokers with alternative trading systems (ATS) from providing non-securities trading, including pairing trades between securities and non-securities. Therefore, he has instructed the SEC team to modernize the ATS regulatory framework to better accommodate crypto asset trading and assess whether further guidance or rules are needed to support the listing and trading of crypto assets on national securities exchanges. This means that traditional securities exchanges may soon be able to list certain digital assets (such as Bitcoin ETFs, tokenized securities, etc.) under compliance, ending the previous situation where "formal markets were not allowed to touch crypto assets." Additionally, during the SEC's construction of a comprehensive regulatory framework, market participants should not be forced to innovate overseas; he is considering providing conditional exemptions for new products/services that are difficult to implement due to current regulatory restrictions, allowing innovative attempts to remain within the U.S.

4. Miners, Nodes, and Staking Services

In terms of crypto infrastructure, Atkins has also released a signal of leniency. He believes that "voluntarily participating as miners, validators, or providing staking services in PoW or PoS networks does not fall under the jurisdiction of federal securities laws." This statement is viewed by the industry as a "get-out-of-jail-free card" for the mining and staking sectors: protecting everyone from Bitcoin miners to Ethereum validators and various staking service providers means that merely participating in network consensus and receiving rewards does not constitute a securities issuance. This stands in stark contrast to the Gensler era, where the SEC frequently targeted staking, even naming Lido and Rocket Pool's liquid staking tokens stETH and rETH as unregistered securities, leading to legal actions against these projects. Atkins has made it clear that the new SEC will no longer arbitrarily create "trouble" for these projects that lack fraudulent behavior but are insufficiently compliant.

5. Self-Custody Wallets and Infrastructure

Atkins publicly supports granting market participants more flexibility to self-custody digital assets, "especially when intermediaries may bring unnecessary costs or restrict on-chain staking activities." In other words, investors should have the right to choose to store crypto assets in their own wallets rather than being forced to hand them over to third-party custodians. Atkins criticized the previous administration's approach, which stifled innovations like self-custody and other on-chain technologies. As a result, the SEC has rescinded Staff Accounting Bulletin No. 121 (SAB-121), which was a guideline from the Gensler era requiring banks and public companies to account for customer crypto assets held in custody on their balance sheets, seen as a significant barrier to providing custody services. Atkins advocates for clearly defining the standards for "qualified custodians" under the Investment Advisers Act and the Investment Company Act, as well as providing reasonable exemptions for common practices in the crypto market. For example, allowing investment advisers and funds to self-custody client assets under specific conditions, as some institutional self-custody solutions are more advanced and can ensure security better than custodial companies. Additionally, he proposed abolishing the current "special purpose broker-dealer" framework and replacing it with a more reasonable system.

# SEC Statements on Non-Securities Crypto Assets

Source: https://www.sec.gov/newsroom/speeches-statements/staff-statement-meme-coins

Since Atkins took office as SEC Chairman, the SEC has released multiple formal statements, staff statements, and guidance documents clarifying the regulatory boundaries for digital assets, indicating that the following types of crypto assets are generally not considered securities:

• Meme Coins: On February 27, 2025, the SEC's Division of Corporation Finance issued a staff statement regarding meme coins. This was the first specific clarification on how federal securities laws apply to certain categories of cryptocurrencies since Trump's executive order on digital assets and the establishment of the cryptocurrency working group. The statement indicated that most meme-type crypto tokens do not fall under the definition of securities and that their issuance and trading are not governed by federal securities laws. The statement described "meme coins" as tokens created based on internet memes, pop culture, or trending topics, where issuers attract community speculation and trading through social media. Such tokens are typically used mainly for entertainment, social, or cultural purposes, lack practical functionality or use cases, and their value is highly dependent on market sentiment and speculative demand. The SEC emphasized that typical meme coins do not generate holding returns and do not grant holders rights to claim income, profits, or assets from any enterprise, fundamentally differing from traditional securities like stocks and bonds. At the same time, the SEC reminded that economic substance should be assessed based on specific circumstances; if a token, despite being labeled as a "meme," possesses investment return attributes or the issuer invests funds to generate profits, it may be deemed a security.

• PoW Tokens: On March 20, 2025, the SEC's Division of Corporation Finance issued a statement regarding certain proof-of-work mining activities, clearly stating that crypto tokens generated through proof-of-work mechanisms are not considered securities and that related mining activities do not constitute securities issuance. This statement applies to activities obtaining block rewards through PoW consensus on public, permissionless blockchains, including both independent mining and pooled mining. "Covered crypto assets" refer only to native tokens that are programmatically linked to the operation of the blockchain network, such as tokens existing to participate in consensus mechanisms or as mining rewards. Miners and pool operators participating in such mining do not need to register with the SEC.

• Stablecoins: On April 4, 2025, the SEC's Division of Corporation Finance issued a statement on stablecoins, determining that fiat-backed stablecoins meeting specific conditions are not considered securities. The statement defines "compliant stablecoins" as digital assets that meet the following conditions: (i) designed to maintain a stable value of 1:1 with the U.S. dollar and redeemable at par; (ii) backed by sufficient low-risk, high-liquidity reserve assets, with the reserve market value at least equal to the total face value of the circulating stablecoins; (iii) limited to payment and value storage purposes, not providing holders with interest, dividends, or other passive income, nor marketed as investment opportunities. For stablecoins meeting the above standards, SEC staff analyzed that their issuance and circulation do not involve offers or sales of securities and do not require securities registration. It should be noted that the above exemption applies only to U.S. dollar-pegged stablecoins with sufficient reserves; algorithmic stablecoins, stablecoins pegged to non-U.S. dollar assets, or stablecoins promising fixed returns to holders are not included in the "compliant stablecoins" category and may not enjoy the aforementioned securities exemption.

• PoS Staking Tokens: On May 29, 2025, the SEC's Division of Corporation Finance issued a statement stating that protocol staking activities in proof-of-stake (PoS) networks do not constitute securities issuance and sales and do not require registration under federal securities laws. This statement defines "crypto assets covered by protocol staking" as blockchain-native tokens that are closely related to the operation and security of public permissionless networks, used to participate in or reward consensus mechanisms and do not grant holders any passive income rights. Staff believe that when holders stake such tokens to operate nodes according to network rules, delegate tokens to third-party nodes for validation, or stake through custodial platforms, the stakers always retain ownership and control over the tokens, and the new token rewards are essentially a return for the resources provided to maintain network security, rather than investment returns derived from the efforts of others. Therefore, whether through self-staking, delegated staking under self-custody, or custodial staking through exchanges, as long as the staked tokens meet the above characteristics, the staking process and the rewards obtained do not constitute securities investment contracts as defined by the Howey test, and the related transactions do not involve securities.

• DeFi Tokens: Currently, the SEC has not issued a specific statement excluding "DeFi tokens" from the definition of securities as a whole. On June 9, 2025, Atkins stated at the SEC's special roundtable on crypto assets that he would instruct SEC staff to study providing a conditional "innovation exemption" regulatory framework for DeFi projects, allowing eligible decentralized finance platforms to operate with fewer regulatory constraints. Atkins emphasized that U.S. law should protect the public's right to participate in blockchain innovation, such as self-custody of digital assets and direct participation in on-chain protocols, which should not be improperly restricted. This reflects the new SEC's desire to "let the market thrive" through flexible regulation. Although these statements are not formal regulations, they indicate the SEC's inclination to adopt a more lenient policy direction towards truly decentralized DeFi tokens that do not have preset investment returns. In the future, the SEC may clarify the legal status of such tokens through further guidance or rule-making.

# Outlook on Potential Policy Measures

Combining Atkins' statements and the current U.S. regulatory environment, several important policy initiatives that may be promoted during his term can be anticipated:

1. Restart and Improve Review of Bitcoin ETFs and Other Products: Crypto asset ETFs faced numerous obstacles during Gensler's era, but the new SEC team has shown a more open attitude. Following the approval of Bitcoin and Ethereum ETFs in early 2024, Atkins has welcomed a surge in applications for altcoin ETFs. The SEC is likely to accelerate the review of such products and develop specific guidelines for crypto ETFs. In addition to ETFs, other innovative financial products (such as funds based on DeFi yields, NFT-backed investment tools, etc.) may also have opportunities for reevaluation.

2. Clarify Standards for Determining Crypto Asset Securities: The long-standing issue of "which tokens are securities" that has troubled the industry is expected to be clarified during Atkins' tenure. Although the Howey test remains a legal cornerstone, the SEC may issue additional guidance or rules specifically explaining the application of this test to digital tokens. For example, clarifying what degree of decentralization means a token is no longer considered a security; how the functional use of tokens (payment-type, consumption-type tokens) affects the judgment of securities attributes; and whether secondary market trading involves securities issuance. In fact, since 2025, the SEC has gradually provided qualitative clarifications through staff statements on some categories: "pure payment-type" stablecoins are not securities, "meme-type tokens" may not be subject to securities laws if there is no issuer, and "proof-of-work/proof-of-stake rewards" do not constitute securities transactions. These scattered clarifications need to be elevated to binding rules or guidelines. In summary, on the core legal issue of securities determination, the new SEC tends to provide answers through explicit regulations rather than enforcement and settlements, aiming to end regulatory arbitrage and ambiguity.

3. Promote Legislative Clarification of Regulatory Jurisdiction: Although the SEC has jurisdiction over the securities domain, crypto assets involve attributes of commodities and currencies, leading to long-standing disputes over the division of responsibilities between the SEC, the Commodity Futures Trading Commission (CFTC), and banking regulators. The "2025 Digital Asset Market Clarity Act (CLARITY Act)" and the "Stablecoin Innovation and Regulation Act (GENIUS Act)" currently being advanced by Congress aim to define regulatory boundaries and establish the legal status of stablecoins. If these laws are passed, the U.S. will welcome a unified regulatory framework for crypto assets, fundamentally addressing issues of regulatory overlap and gaps.

4. Other Possible Reform Initiatives: In addition to the above key points, Atkins' SEC may also introduce measures in internal governance and inter-agency cooperation. For instance, he may reorganize the SEC's internal crypto-related departments, upgrade the status of the Crypto special task force, and establish a dedicated crypto policy office. In terms of enforcement, for cases involving serious fraud or harm to investors, Atkins is expected to continue to pursue them resolutely, even collaborating with the Department of Justice to pursue criminal liability, to establish an authoritative image of "combating crime," thereby alleviating external concerns about being "too lenient." At the same time, to avoid market misinterpretation of his friendly stance, Atkins may periodically issue policy statements or speeches to reiterate that the SEC is neither a "roadblock" nor a "laissez-faire" entity, but rather fulfills its duties in accordance with the law and keeps pace with the times. Such communication will help stabilize market expectations and guide the industry towards lawful innovation.

# Impact and Outlook: A New Direction for the Crypto Market

The favorable policies following Atkins' appointment have already had an immediate uplifting effect on market sentiment. The collective surge of DeFi tokens and Coinbase's stock price rising by 3.5% immediately after the withdrawal of the lawsuit both demonstrate that the improvement in the regulatory environment is being actively priced in by investors. Some institutional analysts referred to the withdrawal of the Coinbase case as "removing a boulder that has weighed on investors for nearly two years," and signs of recovery in trading volume and capital flows in the U.S. have also emerged. This indicates that regulatory benefits are releasing industrial vitality: plans that were previously shelved due to compliance concerns are beginning to restart, and innovators' confidence in the U.S. market is gradually recovering.

If the SEC formally approves a series of crypto ETFs within the next six months, it could further bring about an "ETF effect" that drives new capital into the market. More broadly, clear regulation helps dispel the uncertainty that has shrouded the market for years, thereby attracting traditional institutional investors to allocate digital assets. For example, Wall Street giants like JPMorgan have already begun to lay out digital asset trading platforms and other businesses, indicating their expectation that the policy environment will continue to improve. On the other hand, under relaxed policies, the DeFi sector is expected to experience a revival and upgrade. Developers can more boldly launch new decentralized financial products, which will generate more diverse use cases and applications, driving the evolution of the entire Web3 ecosystem.

While the outlook is optimistic, we must also recognize potential challenges:

• Uncertainty in the Pace and Intensity of Policy Implementation: Many of Atkins' ideas require formal rule-making or congressional legislation to be fully realized, and there may be resistance or delays in this process. For example, will the Democrat-controlled Senate cooperate to pass crypto legislation? Will the SEC's internal Democratic committee vote to support certain reform proposals? These are unknowns.

• External Events' Impact Remains Significant: If the market experiences another major scandal or collapse (similar to the Luna or FTX incidents in 2022), public opinion and political pressure may force the SEC to tighten its stance again.

• State-Level Regulation and Actions by Other Agencies Will Also Affect the Overall Situation: For instance, local regulators like the New York Attorney General have already indicated they will fill the "enforcement vacuum" at the federal level, meaning that even if the SEC relaxes enforcement, state regulators and judicial authorities may still maintain high pressure on the industry.

Conclusion

Paul S. Atkins' appointment marks a new chapter in U.S. securities regulation that is friendly to crypto. In just two months, he has outlined a regulatory roadmap that supports innovation, prioritizes rules, combats fraud, and promotes win-win cooperation through speeches, statements, and actions. It is foreseeable that discussions surrounding Atkins' policies will continue, but regardless, this shift in regulatory paradigm has prompted a rethinking of the boundaries between crypto technology and financial regulation. It is believed that, through rational participation and negotiation from all parties, a regulatory framework that both protects investors and accommodates innovation will gradually take shape, providing valuable experience for the world.

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