SEC’s ’Regulation by Lawsuit’ Era Ends as Paul Atkins Promises Transparent Crypto Rules

Wall Street’s favorite punching bag—crypto regulation—gets a long-overdue overhaul. Paul Atkins, former SEC commissioner and crypto advocate, vows to replace the agency’s ’shoot first, ask questions later’ approach with clear guidelines.

No more guessing games: The days of crypto firms waking up to enforcement lawsuits instead of rulebooks may finally be over. Atkins’ plan cuts through the regulatory fog, promising frameworks that don’t require a team of lawyers to interpret.

Finance veterans smirk: ’Took them only a decade and $2 trillion in market cap to figure out clarity attracts investment.’

Paul Atkins Reaffirms Crypto Regulation Clarity

Titled “Tokenization: Moving Assets Onchain: Where TradFi and DeFi Meet,” the event saw key players in the crypto space, such as Robinhood Crypto General Manager Johann Kerbrat, Fidelity Investments Digital Asset Management head Cynthia Lo Bessette, and Token Asset Coalition Director Johnny Reinsch serve as panelists.

“A key priority of my Chairmanship will be to develop a rational regulatory framework for crypto asset markets that establishes clear rules of the road for the issuance, custody, and trading of crypto assets while continuing to discourage bad actors from violating the law,” Atkins said.

Chairman Paul Atkins’ remarks at the Crypto Task Force roundtable on tokenization:

The topic of this afternoon’s discussion is timely as securities are increasingly migrating from traditional (or “off-chain”) databases to blockchain-based (or “on-chain”) ledger systems.

“Clear rules of the road are necessary for investor protection against fraud, not the least to help them identify scams that do not comport with the law,” he added.

The newly confirmed SEC head then criticized the organization’s previous regulation-by-enforcement approach toward the digital asset sector under then-chair Gary Gensler, claiming that the regulator “will no longer result from ad hoc enforcement actions.”

The Crypto Task Force Continues Roundtable Series

Developed by the SEC’s Crypto Task Force, the roundtable marks the fourth hosted by the federal regulator specifically catered to the blockchain industry.

Created in January 2025 and spearheaded by Commissioner Hester Peirce, the newly launched crypto initiative seeks “to set the SEC on a sensible regulatory path that respects the bounds of the law” without hindering innovation within the sector.

“The Task Force’s focus will be to help the Commission draw clear regulatory lines, provide realistic paths to registration, craft sensible disclosure frameworks, and deploy enforcement resources judiciously,” a January 2025 press release from the agency states.

Despite the SEC’s previous regulatory stance, the latest roundtable may serve as a key turning point for developing a less enforcement-focused regulatory framework in the years to come.