SEC Chair Paul Atkins Floats "Innovation Exemption" for On-Chain Tokenized Securities

Paul Atkins, chair of the U.S. Securities and Exchange Commission, used his one-year anniversary remarks at the Economic Club of Washington to outline a push to revamp the agency's digital-asset rulebook under an "ACT" strategy focused on modernizing regulation, sharpening jurisdictional lines and rebuilding the regulatory framework. Atkins said the SEC has published a classification system for crypto tokens that divides digital assets into five categories, with four deemed not to be securities. He added that the agency plans to roll out an "innovation exemption" that would provide a limited, compliant pathway for market participants to execute tokenized securities transactions on-chain. The SEC has also launched Project Crypto to align securities rules and supervisory systems with the capital markets' shift toward on-chain activity. Atkins noted that last month the SEC and the Commodity Futures Trading Commission signed a memorandum of understanding to harmonize key definitions, clarify regulatory jurisdiction and coordinate oversight of shared areas, including digital assets. He also said the U.S.' prior approach to crypto regulation had pushed innovation offshore.