In a significant policy shift, U.S. Securities and Exchange Commission (SEC) Chair Paul Atkins has detailed the agency’s forthcoming approach to digital asset oversight, marking a clear departure from the contentious “regulation by enforcement” strategy that defined much of the previous administration’s crypto policy.
A New Regulatory Philosophy Emerges
Speaking at the Practising Law Institute on Thursday, Atkins emphasized that the SEC’s recent interpretative notice represents a foundational change, not a final rule. His prepared remarks, delivered following a memorandum of understanding (MOU) signed with the Commodity Futures Trading Commission (CFTC) the prior week, outlined a framework focused first on interpreting how existing federal securities laws apply to digital assets.
“While the interpretation provides long-needed clarity, I should like to assure this audience that it amounts to a beginning, not an end,” Atkins stated, signaling an intent to build a more collaborative and transparent regulatory environment.
Defining the SEC’s Jurisdiction: What’s In and Out
The core of the SEC’s new stance, formalized in Tuesday’s interpretative notice, is a critical distinction: the vast majority of cryptocurrencies are likely not securities under federal law. Atkins elaborated at the DC Blockchain Summit, specifying that only one category remains squarely within the SEC’s remit: “traditional securities that are tokenized.”
He subsequently clarified that assets falling outside the SEC’s primary purview under this interpretation include:
- Digital commodities (e.g., Bitcoin, Ethereum as viewed by the CFTC)
- Digital functional tools (utility tokens used within a platform)
- Digital collectibles, including non-fungible tokens (NFTs)
- Stablecoins designed primarily as payment instruments
This carve-out aims to provide regulatory certainty for most of the crypto market, assigning primary oversight of non-security digital assets to the CFTC under the new inter-agency MOU.
Concurrent Legislative Action Shapes the Landscape
While the SEC’s policy pivot is substantial, it operates alongside a parallel, potentially more permanent legislative track. The market structure bill, initially passed by the House as the CLARITY Act in July 2025, is designed to codify much of this new jurisdictional split between the SEC and CFTC into law. As of Thursday, the bill had not yet been scheduled for a markup in the Senate Banking Committee, a necessary step before a full Senate vote.
Stablecoin Yield Emerges as Key Sticking Point
Progress on the Senate version, advanced by the Senate Agriculture Committee in January, has stalled due to unresolved debates. The primary hurdle involves the treatment of yield generated from stablecoin holdings—a core revenue model for many crypto firms. This issue has created a divide between the banking and crypto industries, and between Senate committees.
In a sign of active negotiation, Republican senators, including Wyoming’s Cynthia Lummis, met privately with White House crypto adviser Patrick Witt on Thursday. A spokesperson for Lummis described the discussion as “very productive and positive,” noting that lawmakers were “99% of the way there on stablecoin yield” and that “negotiations on the digital asset portions of the bill are in a good place.”
Source: Paul Atkins
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