Chairman Paul Atkins unveils sweeping initiative to modernize securities rules for tokenized markets. Most digital assets won't be treated as securities under the new framework. SEC-CFTC MOU targeted for March 2026.
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The SEC just did something that would have been unthinkable two years ago. It announced a formal plan to rewrite America's securities rulebook so financial markets can operate on blockchain rails.
Chairman Paul Atkins introduced "Project Crypto" on July 31, a broad initiative to update US securities regulations for the on-chain era. The core thesis is simple: if stocks, bonds, and other traditional assets are going to be tokenized, the rules governing them need to actually make sense for that technology.
The most consequential element is the SEC's position that a majority of digital assets should not be classified as securities. In English: most tokens won't be treated like stocks, which means they won't be subject to the same registration requirements, disclosure obligations, and enforcement risks that have plagued the industry for years.
The initiative will be developed in coordination with the SEC's Crypto Task Force, led by Commissioner Hester Peirce. The Task Force is expected to produce proposals covering custody rules, trading frameworks, distribution standards for digital assets, and the integration of decentralized finance systems into the regulated financial landscape. Tailored disclosure requirements and exemptions for crypto offerings are also on the roadmap.
A Memorandum of Understanding between the SEC and the CFTC is expected by March 2026, which would establish joint frameworks for classifying tokens that don't fall under securities law.
The broader regulatory overhaul includes updates to existing market structure rules like Regulation NMS. By mid-2026, the SEC plans to have innovative regulatory pathways and updated rules that can accommodate on-chain trading systems alongside traditional exchanges.
Project Crypto is explicitly aligned with President Trump's stated goal of making the US the global leader in cryptocurrency. The initiative responds directly to recommendations from the President's Working Group on Digital Assets, giving it a level of executive branch backing that previous crypto-friendly proposals lacked.
By establishing that most digital assets aren't securities, the SEC removes the existential legal risk that has hung over nearly every token project in the US. Companies that previously faced the prospect of enforcement actions for selling unregistered securities now have a path toward operating within a defined framework.
How the SEC defines acceptable custody solutions for tokenized securities will determine whether banks can hold these assets on behalf of clients, which in turn determines whether pension funds and endowments can allocate to them.
A coherent cross-agency framework with the CFTC could unlock regulated crypto derivatives products that currently exist in a legal gray zone. The mid-2026 timeline for updated market structure rules means the next year will be critical.
The SEC has set a first round of public comment deadlines for October 2025. Project Crypto opens for formal comment on August 15.
Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.