SEC Chair Paul Atkins Flags Possible Rule Updates for Onchain Trading Platforms

SEC Chair Paul Atkins said the agency may reexamine major securities rules as they apply to onchain financial systems, one of the strongest signals yet that U.S. regulators could shift toward a more tailored framework for DeFi markets. Speaking at the Special Competitive Studies Project AI+ Expo on May 8, Atkins argued that existing securities regulations do not always fit modern blockchain-based systems. He said software-driven markets often blur traditional regulatory categories as protocols increasingly bundle trading, collateral management, liquidity routing, settlement, and automated yield strategies into a single application. Atkins said the SEC should consider updating how current rules apply to onchain activity, including requirements affecting exchanges, brokers, dealers, clearing agencies, and crypto "vaults." He also pointed to potential "limited innovation pathways" and future rulemaking aimed specifically at blockchain-based financial infrastructure. A key focus is the SEC's definition of an exchange and its application to decentralized trading platforms. Atkins said the Commission may look to a "future-proofed framework" through formal notice-and-comment rulemaking. He also questioned whether automated onchain settlement systems should be treated under traditional clearing agency rules, noting that near-instantaneous settlement and algorithmic management of counterparty risk call for a fresh analysis of the conventional clearing model. The remarks reflect a shift in tone from the SEC's more enforcement-driven approach to crypto in recent years. Atkins emphasized flexibility and regulatory adaptation, drawing a parallel to the late 1990s when regulators created Regulation ATS for electronic trading systems rather than forcing new technology into legacy market structures. He also praised recent SEC staff guidance, no-action letters, and FAQs related to blockchain markets, saying they helped reduce legal uncertainty for firms testing tokenized and onchain models. Atkins also addressed AI and "agentic finance," cautioning against rigid technology standards that could constrain innovation. While he said AI could broaden market participation and strengthen risk management, he stressed that firms remain accountable for the tools they deploy. His comments come as crypto companies build infrastructure for AI-driven payments, autonomous agents, and onchain financial automation. Final Summary: SEC Chair Paul Atkins signaled potential rule changes for onchain trading systems, clearing models, and crypto infrastructure, suggesting the agency may move toward a more tailored regulatory framework for DeFi markets.