Breaking News Update: SEC Chair Paul Atkins Provides Insight on Digital Asset Regulation

What: SEC Chairman Paul S. Atkins delivered testimony before the U.S. Senate Appropriations Subcommittee, outlining a strategic realignment of the Commission’s regulatory posture. His focus was on restoring what the administration considers the SEC’s core mission, reforming regulatory processes, and establishing a rational, rule-based framework for digital asset oversight, with a particular focus on shifting away from regulation-by-enforcement.

Who: SEC Chairman Paul S. Atkins.

When: Testimony delivered on June 3, 2025, marking the beginning of Atkins’ formal agenda as Chairman and a reset in SEC regulatory philosophy aligned with the Trump administration’s deregulatory posture.

Why: Atkins seeks to recalibrate the SEC’s regulatory priorities toward fostering capital formation, economic efficiency, and innovation (particularly in digital asset markets) while preserving investor protection. He stated, “[i]t is a new day at the SEC. I am determined that we return to our core mission that Congress set for us more than 90 years ago.”

How: Atkins’ stated objectives for achieving goals include:

• Ending regulation-by-enforcement in favor of notice-and-comment rulemaking.
• Forming a Crypto Task Force to develop rules on digital asset classification, custody, trading, and DeFi.
• Disbanding FinHub and embedding innovation throughout the SEC’s core functions.
• Conducting a technology infrastructure review and reducing staff and operational costs in alignment with budget neutrality and agency efficiency.
• Requesting Congressional authority to potentially absorb PCAOB functions.
• Reiterating focus on clear, economically justified rules that avoid unnecessary market friction.

Why It Matters: Chairman Atkins' testimony signals a regulatory inflection point for RIAs and BDs engaged in digital asset activities. Firms can expect:

• Greater regulatory clarity and engagement opportunities.
• A potential rollback of previously aggressive enforcement actions in crypto markets.
• A regulatory environment more conducive to innovation and capital formation.
• Ongoing vigilance on fraud prevention and investor protection, even amidst a lighter regulatory touch.

Atkins affirmed, “[t]his SEC will work to protect investors from fraud, keep politics out of how our securities laws and regulations are applied, and advance clear rules of the road that encourage investment in our economy to the benefit of all Americans.”

CRC keeps its thumb on the pulse of the evolving regulatory landscape. Keep an eye out for additional information, including updated guidance, risk alerts, and CRC’s thoughts on how to ensure successful compliance with evolving regulatory expectations within your firm’s existing regulatory compliance program.

Contact Mitch Avnet for further details: (646)346-2468 | mavnet@compliance-risk.com