In months, regulators’ approach to cryptocurrency has altered drastically. First, it was the dismissal of lawsuits against major crypto exchanges like Binance, then the repeal of Staff Accounting Bulletin (SAB) 121 that required firms holding crypto assets to recognize them as liabilities, and next the Department of Justice’s (DOJ) decision to disband its National Cryptocurrency Enforcement Team (NCET).
With new administration at the top, regulators are aiming to place the U.S. at the forefront of the digital financial technology space, promote innovation, and loosen guardrails that were believed to stymie crypto’s growth in the market. Alongside the litigation and rule changes taking place, the SEC also created the Crypto Task Force in January 2025, propelling its mission to establish clearer guidelines around digital assets and how they should be regulated.
Regulators determining the direction that crypto will crypt-go
As part of its mission, the Crypto Task Force held a series of roundtables over several months to initiate discussions about pertinent topics relating to digital asset oversight, namely security status, trading, tokenization, and custody. With the final roundtable having taken placed on June 9, SEC Commissioners explored the consensus on crypto, and its plans for governance moving forward.
Flashing back to the first roundtable, SEC Commissioner Hester Pierce – who is spearheading the Task Force – implored attendees to consider foundational questions about the definition of securities and how crypto fits in. In addition, the roundtable served as a platform to discuss whether security status is fixed or variable, how decentralization comes into play, and the ability to mold current characteristics of a security into a more wide-ranging taxonomy to fit cryptocurrencies.
Successively, roundtables two through five delved into the topic of trading activities where crypto assets are involved, the appropriate distinction between qualified custodians vs. self-custody, the meeting point between traditional finance and decentralized finance (DeFi) when handling tokenization, and the line between regulatory oversight and investor autonomy in relation to DeFi.
Echoing Pierce’s crypto-friendly stance on regulation, SEC Chair Paul Atkins emphatically endorsed the evaluation of crypto frameworks and its integration into the market. He specifically praised the move away from enforcement-led regulation and proposed new rules around on-chain products:
“While the Commission…work[s] to propose fit-for-purpose rules of the road for on-chain financial markets, I have directed the staff to consider a conditional exemptive relief framework or “innovation exemption” that would expeditiously…bring on-chain products and services to market. An innovation exemption could help…make America the “crypto capital of the planet” by encouraging developers…to innovate with on-chain technologies.”
Bit by bit(coin)
Alternatively, Commissioner Crenshaw holds a different opinion on crypto and the path forward following the final roundtable. While the Commission is implying a fast-paced progression in digital asset regulation, Crenshaw stated that the complexity of the assets calls for slower and steadier progress:
“In sum, these roundtables have given us a lot to grapple with, to say the least. While the series was billed as a “spring sprint towards crypto clarity,” I am unsure whether we’ve identified much that can be simply or quickly clarified. When it comes to crypto, it does not appear to me that the SEC is facing problems with ready or easy solutions.”
So where does crypto regulation stand following regulatory movement from the SEC? Where the previous governance saw all tokens as presumed securities and utilized a case-by-case approach, the regulator is now proposing more formal rulemaking to reduce uncertainty. Chair Atkins stated that the regulator will develop a framework that establishes clear rules around the issuance, custody, and trading of assets:
“The Commission will utilize its existing authorities to set fit-for-purpose standards for market participants.”
As Pierce stated, “most currently existing crypto assets” are not considered securities, though the SEC is still taking steps to evaluate each individual asset to create an “official” list. While digital assets like Bitcoin are classified as a commodity as opposed to a security, other tokens are being considered based on their function and could fall under securities, utilities, or payments.
As of now, the SEC has announced rulemaking plans for a range of crypto assets, such as token issuance, crypto trading platforms, and custody rules. In the coming year, it seems the regulator plans to build out more defined frameworks for additional assets like stablecoin, and plans for commodity and security distinctions.
Track the chain, capture the comms
While cryptocurrency assets face a period of vast transformation, signs point toward the continued integration of digital assets into traditional finance workflows. Should this be the case, surveillance of crypto-related communications to monitor conflicts of interest, lack of disclosures, insider trading, and other risk areas become vital.
This isn’t the first time that regulators have requested that firms disclose communications data around crypto assets. In 2022, the Financial Industry Regulatory Authority conducted a sweep of retail communications related to crypto products in order to increase transparency within the industry. Despite shifting regulatory approaches, transparency and accountability remain a top priority above all, to uphold market integrity and ensure consumer protection.
As regulators are at a point of inflection in outlining crypto governance and promoting broader integration of digital asset technology, proactive surveillance remains a core element of compliance to fight against misconduct and keep current in quickly evolving crypto landscape.
