SEC Chair Atkins Eyes a Reg ATS-Style 'Innovation Pathway' for On-Chain Trading!

SEC Chair Paul Atkins used a May 8 speech to signal the agency could offer a limited 'innovation pathway' for on-chain trading systems in the near term — drawing an explicit parallel to how the SEC handled electronic trading in the 1990s. That era ended with Regulation ATS in 1998, a middle-path rule that let alternative trading systems operate as broker-dealers under specific conditions. Atkins is pointing at the same two-step sequence: targeted conditional relief first, formal rulemaking second.

The structural problem Atkins acknowledged is real: traditional SEC rules were built around separate actors performing separate functions — exchanges, broker-dealers, clearing agencies, transfer agents. A single on-chain protocol can collapse all four automatically, often within seconds. Applying a rulebook designed for that separation to software that eliminates it produces the legal…