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SEC Chair Paul Atkins said Friday the agency is weighing formal rulemaking around onchain trading systems, blockchain settlement infrastructure, crypto vaults and AI-driven financial applications, framing it as the next step in the regulator's pivot away from the enforcement-heavy approach of his predecessor Gary Gensler. Speaking at the AI+ Expo in Washington, Atkins argued that existing securities rules — designed around brokers, exchanges and clearinghouses as separate intermediaries — no longer map cleanly onto blockchain protocols that collapse those functions into a single piece of software.
Why it matters
Atkins drew a sharp line between rule-writing and case-by-case enforcement, the same fault line that defined the Gensler era. "A single protocol can execute a trade, manage collateral, route liquidity, execute trading strategies through vault structures and settle the transaction," he said. He added that the SEC should "clarify how the Commission views the spectrum of models that may implicate our statutes through notice and comment rulemaking, using our exemptive authorities where necessary and prudent." The pitch is for the agency to set the rules of the road up front rather than litigate them afterward, and to do so in a way that explicitly accommodates hybrid traditional-decentralized market structures.
Market impact
The speech pairs onchain market structure with an AI frame: Atkins argued that AI agents will increasingly act in markets at machine speed, and that blockchain rails let those systems move value instantly — together creating a financial stack the current rulebook was not built for. He also reiterated support for the CLARITY Act, the congressional market-structure bill that would split digital asset oversight between the SEC and the CFTC. For trading platforms, vault operators and protocol developers, the near-term read is that bespoke rulemaking and exemptive relief are now the agency's preferred tools, with staff guidance and no-action letters already landing to reduce legal uncertainty under the current administration.
Frequently asked questions
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What did SEC Chair Paul Atkins announce about onchain markets?
Atkins said the SEC is considering formal rulemaking around onchain trading systems, blockchain settlement infrastructure, crypto vaults and AI-driven financial applications, replacing the prior case-by-case enforcement posture with notice-and-comment rules and exemptive relief.
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Why does Atkins say current securities rules don't fit blockchain protocols?
He argued existing rules were designed around brokers, exchanges and clearinghouses as separate intermediaries, whereas a single blockchain protocol can execute trades, manage collateral, route liquidity, run strategies through vaults and settle — collapsing functions that were once siloed.
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How is this different from Gary Gensler's approach to crypto regulation?
Gensler largely pursued crypto firms through enforcement actions against centralized venues. Atkins is pivoting toward writing tailored rules up front and using staff guidance and no-action relief, while still backing congressional legislation to define the SEC–CFTC split.
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What is the CLARITY Act and how does it fit in?
The CLARITY Act is a congressional market-structure bill that would establish a shared framework for digital assets between the SEC and the CFTC. Atkins reiterated his support for the bill alongside the SEC's own rulemaking effort.
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What does this mean for crypto trading platforms and protocol developers?
The near-term signal is that bespoke rulemaking, exemptive relief and staff guidance — not lawsuits — are the SEC's preferred tools. That should reduce legal uncertainty for onchain venues, vault operators and protocol teams building hybrid traditional-decentralized products.
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