SEC Chair Atkins Proposes Crypto Exemptions to Lure Issuers Back

SEC Chairman Paul Atkins on Aug. 18 proposed a set of tailored exemptions for crypto assets, framing the move as a way to reverse the overseas drift of digital-asset issuers. The plan, called Regulation Crypto Assets, includes specific offering routes and disclosure duties, along with a safe-harbor condition for network development.

Atkins argued that earlier SEC practices forced companies selling non-security crypto assets through investment contracts to apply securities rules written for different markets. That created complications that pushed activity abroad. In his official statement, he said tailored exemptions could invite entrepreneurs back while preserving core investor protections.

Atkins placed congressional legislation above administrative action as the durable basis for crypto market structure. He voiced support for the CLARITY Act, saying a future regulator could otherwise reverse the Commission's work.

"The SEC has and will continue to support Congress in delivering the CLARITY Act to President Trump's desk," Atkins said.

The CLARITY Act would provide a statutory framework for digital asset classification and market structure, reducing the SEC's reliance on administrative rulemaking. Atkins said the proposal should be seen as a complement to that legislative effort, not a substitute.

Commissioner Hester Peirce, who had long advocated a defined path for network development, said the rulemaking drew on extensive public engagement. Responses from both crypto supporters and critics helped shape the framework after the Crypto Task Force requested industry views, she wrote in her Aug. 18 statement. She acknowledged that the exemptions and safe harbor would not fit every business model.

The safe-harbor component, which Peirce first proposed in 2020, would allow developers to build and decentralize a network without immediate registration, provided they meet conditions such as public disclosures and progress toward decentralization. Atkins said the current proposal builds on that work.

"This proposal is one step on a long road toward a clear, sensible, enforceable regulatory framework for crypto," Peirce said.

Commissioner Mark Uyeda emphasized predictability. Fixed thresholds and disclosure duties would let issuers assess compliance before conducting an offering, he wrote. He contrasted that model with enforcement cases that left market participants guessing how individual actions might apply to their own operations.

Uyeda said the Commission's previous approach denied entrepreneurs a realistic registration path for crypto fundraising. Good-faith engagement sometimes met subpoenas or litigation rather than answers, he wrote.

The proposal is part of a broader move toward formal crypto rulemaking under Atkins, a shift from the enforcement-led approach that Uyeda criticized.

Investor-protection concerns persist as the agency weighs whether reduced registration obligations could create new risks in primary and secondary markets. Atkins and Uyeda argued that clearer rules would strengthen investor protections by providing a predictable compliance path. Peirce said the proposal was designed to enable legitimate products while allowing regulators to enforce consistent standards.

Atkins credited Peirce with the intellectual foundation for the safe-harbor component. He described the proposal as a fulfillment of her original idea, while his wider regulatory agenda connects crypto clarity with capital raising and tokenized securities, part of a broader push to modernize U.S. markets.

Regulation Crypto Assets remains a proposal. The SEC will accept public comments before any final rule takes effect.