- SEC Chair Paul Atkins has distanced himself from his December 2025 remarks that suggested regulatory relief for certain crypto products, such as tokenised equities and DeFi, could come into effect in January 2026.
- Atkins was more wishy-washy on Thursday, saying the situation is now more complex, with many “moving parts.”
- His remarks come just days after the SEC’s crypto taskforce met with Wall Street leaders opposed to moves granting crypto-specific regulatory relief.
Securities and Exchange Commission Chair (SEC), Paul Atkins, appeared to distance himself from earlier comments signalling a broad crypto innovation exemption in remarks made on Thursday. Atkins’ changed stance comes just days after the SEC’s crypto task force met with Wall Street leaders who aired their concerns around the planned regulatory carve-outs.
The proposed exemption would see crypto firms offering specific types of products and services — such as DeFi and tokenised equities — guaranteed protection from enforcement action by the SEC.
In December 2025, Atkins said he expected the exemption to be active before the end of January 2026, despite the lengthy government shutdown and delays in the passage of the crypto market structure legislation known as CLARITY Act.
“We have enough authority to drive forward, I’m looking forward to having an innovation exemption, we’ll be able to get that out in a month or so,” Atkins told NBC’s Squawkbox on December 2.
“We’re on track and we’ll be able to forge forward in the crypto area and make sure that we are able to embrace this new area of innovation that for too long the United States has basically just pushed back against,” he said.
Now though, Atkins’ ‘forging forward’ looks more like a regulatory holding pattern. At a crypto event held Thursday featuring leaders from both the SEC and the Commodity Futures Trading Commission (CFTC), Atkins was asked when we might see the exemption put in place.
We’re still working on that, obviously. We need to measure twice and cut once.
Paul Atkins, SEC Chair Atkins also suggested the delay in the passage of the CLARITY Act is now impacting the SEC’s ability to move forward on the exemption.
“It would be nice to see direction from Congress,” the SEC Chair said.
When asked directly if the SEC now plans to wait for Congress to pass the CLARITY Act before moving on the exemption, Atkins gave another vague response, saying “not necessarily…there are a lot of moving parts to the situation.”
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Wall Street Opposes Crypto-specific Exemptions
Part of the reason for Atkins’ weaker language around the crypto innovation exemption is likely opposition from Wall Street, which fears such regulatory carve-outs could destabilise the broader US economy and benefit crypto at the expense of their own businesses.
On Tuesday this week, representatives from Wall Street giants JP Morgan, Citadel and the Securities Industry and Financial Markets Association (SIFMA) met with the SEC’s crypto taskforce to discuss the crypto-specific regulatory exemption, according to SEC records.
The records show that the TradFi firms warned that broad regulatory relief granted to large swathes of the crypto industry could potentially harm the US economy.
“Broad exemptions for tokenized trading activities could undermine investor protection and lead to market disruptions,” meeting materials submitted by SIFMA argued.
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The meeting materials also highlighted the October 10, 2025, flash crash of the crypto market, in which a record US$19 billion (AU$27b) was liquidated in just a few hours — warning that similar instability could impact the wider financial system if crypto firms are allowed to trade tokenised equities without strict regulatory oversight from the SEC.
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