SEC’s "Project Crypto" Aims to Crown USA as Undisputed Global Crypto Hub by 2025

The SEC just fired the starting gun in the race for crypto supremacy—and Wall Street might finally need to update its playbook.

### From Reactive to Dominant: How Project Crypto Flips the Script

No more playing defense. The SEC's newly unveiled initiative throws down the gauntlet, targeting regulatory clarity and infrastructure to lure blockchain innovators stateside. Think streamlined filings, sandbox programs, and—wait for it—actual dialogue with industry builders.

### The Unspoken Stakes

While politicians debate CBDCs, Project Crypto quietly positions the US to capture an estimated $12T in institutional crypto inflows by 2030. The twist? It's funded by enforcement penalties collected from last cycle's rug-pull artists—poetic justice even crypto skeptics can appreciate.

### The Cynic's Corner

Of course, this being finance, expect half the participating VCs to rebrand their 2008-era mortgage-backed securities funds as "blockchain liquidity vehicles" by Q3. Some things never change—not even during revolutions.

A New Framework for Digital Assets

Project crypto is built upon recommendations from the President’s Working Group on Digital Asset Markets and the recently signed GENIUS Act for stablecoins. Chairman Atkins has directed SEC staff to swiftly draft clear and simple rules for crypto asset distribution, custody, and trading.

Key pillars of the initiative include:

• Clarifying the “Howey Test”: A top priority is creating bright-line rules to help entrepreneurs determine if a digital asset is a security. Chairman Atkins asserted, “most crypto assets are not securities.” 
• Onshoring Capital Formation: The SEC will propose new regulations for Initial Coin Offerings (ICOs), airdrops, and network rewards to encourage these activities within the U.S. “The days of convoluted offshore corporate structures, decentralization theater, and confusion over security status, are over,” Atkins said.
• Modernizing Custody Rules: The project will overhaul custody requirements for registered intermediaries, moving away from restrictive policies like SAB 121. Atkins stressed the importance of both self-custody as a “core American value” and providing clear rules for firms that custody assets for investors.

Unleashing Innovation with “Super-Apps” and DeFi

One of the Core objectives of Project Crypto is to create new, combined business models. Atkins was a proponent of the idea of “super-apps,” in which one licensed entity, such as a broker-dealer, would be able to trade traditional securities, crypto securities, and non-security tokens, along with staking and lending services.

“We should not force market participants to be stretched to fit a Procrustean bed of regulation for regulation’s sake,” he explained.

In addition, the SEC will endeavor to revise “ancient” rules to support on-chain software systems, such as decentralized finance (DeFi) protocols, including automated market makers (AMMs). This means that there could be potential revisions to rules like Regulation NMS that will enable intermediated and purely decentralized market structures to innovate.

To drive development, Atkins also tested the concept of an “innovation exemption,” a sandboxing environment in which new business models can go to market quickly on principles-based terms instead of prescriptive requirements.

Also Read: WHITE House Publishes Digital Assets Report on BTC Reserve